C (3:30)

Absolutely. And I was chatting with some diplomats ahead of the fac, and what they say is, indeed there is this issue that you just described about the Druzhba pipeline. But they say this is something that Orban is very good at doing. One of them described him as a sort of black belt in orchestrating these moments where he becomes the protagonist. He's holding everything up and he's done it very well. And he's got all these different things in the air. The sanctions, the loan, the EU ties, top officials going to Kyiv. And of course, it's a recipe for putting himself right in the middle of this action. Some of those diplomats were saying perhaps don't expect to deal on the sanctions today, but remember that Orban almost always backs down on his threats. So they expect those sanctions to go forward, but he is intending to rain on the parade in Kyiv.

B (4:20)

Yeah, Orban often backs down, but sometimes he extracts a pretty nice price for that backing down. So, you know, what, what sort of stuff is he trying to extract from the eu? We know that there some funding that he'd like the EU to unfreeze money for Hungary. We know that his election is coming up very shortly. There's, you know, it's in April, Nick. So he wants to use this spat essentially at home to win over votes because he's behind in the polls and we know that this is key for him.

C (4:48)

Exactly. I think what he's trying to get here is political points to show his voters that he really is Ukraine's top opponent in the EU and that he's willing to go head to head with the commission, with other member states to hold up this money, to hold up these sanctions. And that's what he's doing.

B (5:04)

Yeah. And on the sanctions, a key element of the sanctions that I think it is worth us talking about today. Is this maritime services ban. That's where basically Russian oil, it still depends on European linked services to reach its buyers. So it's like insurance, shipping management, port services, refueling. And so the idea for this 20th sanctions package, the major change here is that there would be a full ban, meaning EU companies, they can no longer provide services to these ships that are carrying Russian oil. So that would make it much more expensive. Right, Nick?

C (5:35)

Yeah. So this is, it would pack a big punch, effectively, because you've got sanctions that target the oil exports, the Russian ships themselves. Then you've got sanctions that target the shadow fleet. And what we're doing here is saying, oh, what we're going to do is make it impossible for the shadow fleet to get maintained and to get serviced in EU ports. And a lot of the places where these ships are supposed to stop are actually in the euro. And now this is something that most countries are pushing for some optimism. In briefings last week, we know that Greece and Malta, which have a big maritime services sector, had some objections, but there was optimism that those issues could be worked through to really kind of deliver this big punch for the 20th package. And remember, the United States has also been on board in going after the shadow fleet. And then of course, this Hungary issue came up. And now what people are talking about is will there be a call from Donald Trump in the past when Hungary has been blocking or holding up a big package? You know, Washington has stepped in and told Budapest, well, maybe it'd be a good idea if you let this one go. And people are kind of hoping for that today.

B (6:44)

Well, it's going to be a fascinating Foreign Affairs Council. I'm really interested to see what comes out of it because we know that this is kind of the last opportunity before Ursula von der Leyen and Antonio Kosta get on this plane and on the train to Ukraine. You're hearing some, some reports that there may even be kind of a last minute scramble later today after the right.

C (7:05)

Indeed, there's the fac, but there's also the real last chance is a co repper gathering of EU ambassadors is supposed to take place today after the FAC meeting where perhaps they could pull an 11th hour deal on the sanctions to get that over the line. Diplomats kind of mixed views on that, whether that would be possible.

B (7:29)

All right, Nick. Well, let's actually go north now for our second story. There's been lots of talk since the Icelandic election back in 2024 about the country potentially restarting its EU accession negotiations. Now it's looking like things are going to move quite a lot faster. The ruling coalition had promised to hold a referendum on restarting talks by 2027, but I'm reporting this morning that preparations are actually underway for a referendum that could come as early as August.

C (7:59)

Right. And this is part of the rapid geopolitical shift we're seeing with Trump. He has imposed 15% tariffs on Iceland. He's also repeatedly mentioned Iceland in the context of Greenland, and he's managed to spook all the inhabitants of that island. And this is really unsettling for a country that doesn't have its own army, relies on NATO and a 1951 defense agreement with Washington for its security. But, Zoya, you've gone into this in your story. What sense did you get? Is this mostly kind of about the larger picture here? For the Icelandic people?

B (8:32)

This began back in 2024, quite a long time before Trump was back in the White House. So I think this conversation had already started. But definitely all of this Trump stuff has lent a new sense of urgency. And the main concern that I've been picking up when I'm talking to my sources here, it's about security more broadly. So it's not just about, is Trump going to come and invade? I don't think that is so much of concern. Although, again, you know, we heard Trump just over the weekend say that he's going to send a ship to provide health care to Greenland. And I think, again, every time he brings up Greenland, every time he says something like that, it spooks the countries that are kind of on their own in that Arctic area. But Iceland is a pretty small country from the perspective of population. It's only got around about 400,000 people. It's quite a wealthy country. It's got a really high gdp. It's per capita the fifth highest GDP in the world. But ultimately, it is quite defenseless because it doesn't have an army and it doesn't have the capacity to defend itself.

C (9:28)

Right. And let's not forget that they have considered EU membership in the past. Right. They've been down this road before. They applied in 2009. And then what happened?

B (9:38)

What happened was 2009 was the nexus of the global financial crisis and the Icelandic banking crisis. So three of their banks collapsed. Their currency was devalued hugely, and it was a real, very difficult time for Iceland. So that's when they decided to apply for EU membership, looking at it as sort of like a lifeboat, really. But then by 2013, Iceland had really quite significantly recovered. Their currency was doing well, their exports were doing well because of that devaluation of the currency, and so they were doing quite well. But meanwhile, it was the peak of the Eurozone crisis and they had looked at what was happening in Europe and they looked at what was happening in Iceland and decided that they weren't actually all that keen to join the bloc anymore. And actually they withdrew their application. So that's the backstory. Now, of course, the context has changed, significant, and they're back looking at it again now. We don't know whether the vote will be a yes or a no vote once this referendum happens, but nonetheless, there is this sense that this feels more likely now than it did before.

C (10:39)

And things now look different inside the EU as well, isn't it? I mean, we've had Brexit. There's also a fishing issue which seems to have kind of shifted.

B (10:48)

Yeah, it's exactly that, because one of the major blocks in the talks last time was phishing. Iceland was having this massive dispute with the UK over mackerel fishing rights, because, generally speaking, mackerel used to hang out in UK waters, but because of the warming of the oceans and global warming in general and climate change, those mackerel were starting to go then north and were in Icelandic waters. And the Icelanders wanted to fish more, and the UK was really mad about it. And so there were a series of spats and essentially the UK was blocking, in some ways, Iceland's talks, and there was a lot of drama around mackerel fishing at the time. Now, of course, the UK isn't in the EU anymore. The Brexit dividend for Iceland.

C (11:35)

And in your story, you report that things could go very quickly with Iceland. Right. They fulfill a lot of the criteria already. Walk us through sort of what could happen in terms of Iceland joining.

B (11:45)

Yeah, that's right, Nick. Basically because Iceland is already in the European Economic Area, because they're in the Schengen Zone. A lot of the EU's legislation is already on Iceland's books. So they've done heaps of the homework. In fact, I did have one, one EU source speculating to me that if they were really fast, Iceland could probably close negotiations within a year if they reopened them.

C (12:08)

So that would effectively put them almost at the front of the line here, because we've been talking a lot about Montenegro being a potential joiner in the coming two years, Even Ukraine. You've reported that there's talk of Ukraine coming in via reverse enlargement in 2027. Where's Iceland in that running?

B (12:27)

Well, it would be pretty high on that list. I'm not going to say that it would be first in line, but it could be very, very quick if it does decide to go ahead with this. Of course, the thing to remember is that even after the negotiations are finished, it would still need to go to a referendum, a second referendum among Icelanders to decide whether they want in or not. So things could all still fall apart at the last hurdle.

C (12:50)

All right.

B (12:56)

And finally, Nick, trade drama in Washington. The European Commission has issued a pretty extraordinary statement calling for full clarity from the US after the Supreme Court struck down Donald Trump's global tariff policy. And then Trump announced that he was going to slap 15% tariffs on everyone anyway. What is this all about?

C (13:17)

Yeah, I mean, it's just the topsy turvy crazy trade story is heating up again. And we had the Supreme Court ruling that Trump's global tariffs, which are the centerpiece of his economic policy, were unlawful. And instead of backing down, Trump responded the next day by announcing a brand new global tariff rate of 15%, using a different legal tool that may well be open to challenge itself. So the legal foundation changed overnight, but the approach is the same from the administration.

B (13:48)

Yeah. So this really puts into doubt that Turnberry agreement that the EU and the US struck last summer, because it just means that we don't know whether the US is going to be able to stick to its end of the deal. It's actually gotten so far that Bernd Langer from the European Parliament's Trade Committee, he's the chair of that committee, he's now calling for a delay to a vote that was supposed to happen this Tuesday on implementing the EU side of the deal. So really watch this space. Before we go, Nick, you've got a special birthday shout out for someone who's on your beat.

C (14:25)

Yeah. Happy birthday to Poland's Foreign Minister Radislaw Sikorski, who happens to be in the room for the Foreign Affairs Council today.

B (14:32)

Yeah. Radek Sikorsky, who is fond of a razor remark of his own. So maybe he'll serve up a slice of cake and maybe a little more to his old mate Shiato from Hungary.

C (14:43)

Hey, absolutely. Those two are known for going at it on Twitter. And. And what better time to do it than on your birthday?

B (14:50)

Well, I've said it before and I'll say it again. Stolat. All right, folks, that's it from us today. Thanks for joining us. Please do subscribe. Make sure that you rate and review us. Tell your friends, tell your mum. I'd like to hear from her. Tell her to WhatsApp US numbers in the show notes. Nick, thank you for joining us today.

C (15:06)

Thanks for having me, Zoya.

B (15:07)

I'm Zoya Sheftolovich. Thanks so much.

A (15:21)

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