Iceland maintains diplomatic and commercial relations with practically all nations, but its ties with other Nordic states, with the U.S., and with the other NATO member states are particularly close. Icelanders remain especially proud of the role Iceland played in hosting the historic 1986 Reagan-Gorbachev summit in Reykjavik, which set the stage for the end of the Cold War.

Iceland has greatly increased its international profile since the early 1990s with the end of the Cold War. In 2001 alone, the government opened new embassies in Canada, Japan, and Mozambique, bringing the total number of its overseas missions to over 20. Buying and outfitting the embassy in Tokyo cost more than $7 million, an extraordinary investment for this small country, whose total foreign affairs budget in 2000 amounted to a little more than $40 million. Since the mid-1990s, Iceland has opened eight missions overseas, including an embassy in Beijing, giving Iceland a diplomatic presence in all five permanent member countries of the UN Security Council. Not coincidentally, one of Iceland's key foreign policy goals is to win a seat on the UN Security Council for the 2009-10 term. In the past few years, Iceland also has established missions to the Council of Europe in Strasbourg and to the OSCE in Vienna. In 1998, it bolstered its delegation to NATO, assigning a permanent representative to the military committee for the first time ever.

Notwithstanding its status as an unarmed nation, Iceland has been eager to do its part to contribute to the maintenance of international peace and security. One of the niches it is trying to fill is in civilian peacekeeping and crisis management. It took a significant step forward in this area in 2001 by launching its Icelandic Crisis Response Unit (ICRU). In setting up the ICRU, the Ministry for Foreign Affairs established a roster of 100 experts in various occupations (police officers, nurses, doctors, lawyers, engineers, journalists, etc.) who will be specially trained and prepared to deploy to troubled spots abroad on short notice.

Peacekeeping has been a permanent item in the Icelandic state budget since 1994, and Iceland has been an active member of the UN Peacekeeping Committee since 1997. Iceland had an average of five peacekeepers-- primarily doctors, nurses, and police officers--in Bosnia at any given time from 1994 to 1999, and it doubled that number to 10 in 2000. During 2001, Iceland had an average of 15 peacekeepers in the Balkan region at any given time. Most of the peacekeepers continued to be policemen, doctors, and nurses, but a few engineers, media experts, and social scientists also were deployed. With the formal establishment ICRU, the government decided to increase the number of peacekeepers to 20 in 2002 and to 25 in 2003. By 2006 Iceland wants the capability to deploy up to 50 peacekeepers overseas at any given time.

Icelanders have a strong emotional bond toward the Baltic states, and Iceland prides itself on being the first country to recognize their claim for independence in 1991.

Membership in International Organizations
Iceland is a member of the following organizations: Arctic Council, Barents Euro-Arctic Council; Council of Baltic Sea States; Council of Europe; European Economic Area; European Free Trade Organization; EFTA Court; EFTA Surveillance Authority; North Atlantic Treaty Organization; Organization on Security and Cooperation in Europe; Organization for Economic Cooperation and Development; International Criminal Police Organization; International Council for the Exploration of the Sea; International Hydrographic Organization; International Maritime Satellite Organization; International Telecommunications Satellite Organization; International Union for the Publication of Custom Tariffs; Nordic Council; North-East Atlantic Fisheries Commission; North Atlantic Salmon Conservation Organization; the International Whaling Commission; and the North Atlantic Marine Mammal Commission.

It also is a member of the United Nations and most of its related organizations, specialized agencies and commissions, including the International Monetary Fund, World Trade Organization, World Tourism Organization, Food and Agricultural Organization, International Atomic Energy Agency, International Civil Aviation Organization, International Fund for Agricultural Development; Industrial Development Organization; International Labor Organization, International Maritime Organization, International Telecommunications Union, UN Educational, Scientific, and Cultural Organization, Universal Postal Union, World Health Organization, and World Meteorological Organization; World Intellectual Property Organization; International Bank for Reconstruction and Development; International Development Association; International Finance Corporation Multilateral Investment Guarantee Agency and International Center for Settlement of Investment Disputes; UN Conference on Disarmament; Economic Commission for Europe; UN High Commissioner for Refugees; Office for the High Commissioner for Human Rights; Commission of Human Rights; UN Conference on Trade and Development.