The Many Commonalities

Arctic states and like-minded allies are just two of ways to describe the bond between Canada and Iceland. The two countries began establishing diplomatic relations in the 1940s, soon after Iceland assumed full authority over its foreign affairs from the Kingdom of Denmark. Particularly in their approaches to defence can many similarities be drawn between Canada and Iceland. Both countries are firmly committed to collective defence, principally through their memberships in the North Atlantic Treaty Organization (NATO). Yet, an equally important similarity between their defence strategies is often understated: a unique defence relationship with the United States that goes beyond their memberships in NATO.

Iceland’s Defence Partnership with the United States

Following centuries of Danish rule, Iceland gained sovereignty in 1918 and eventually became an independent republic in 1944. The new Icelandic government did not establish its own military, choosing instead to build its security and defence on cooperation with allies. Today, its Coast Guard is responsible for search and rescue, maritime surveillance, and law enforcement in Icelandic waters. Iceland’s two pillars of security are recognised as its alliance with NATO and the bilateral US-Icelandic defence agreement.

Founding Member

Through NATO, of which Iceland was a founding member in 1949, member states take turns patrolling Icelandic airspace from the US Naval Air Station Keflavík. Meanwhile, the bilateral agreement with the US was formalized in 1951 and originated from the initial US military presence in Iceland during the Second World War. This agreement established a permanent military presence in Iceland and placed the responsibility of protecting Iceland primarily with US forces, alongside the Icelandic Coast Guard. Initially, the agreement was controversial, as the newly independent state of Iceland frowned upon foreign presence. This was especially true for foreign military presence in times of peace. The agreement was revised in 2006 and the United States withdrew its troops from Iceland, though it began participating in NATO air policing and military exercises in 2008. As of 2016 the American military is once again operating in Keflavík as NATO-Russia tensions increased.

Canada’s Defence Partnership with the U.S.

Canada and the United States likewise have a close defence partnership, as both are inextricably connected through the defence of North America. Their partnership dates back to before NATO. Namely, it began in 1938 with a pledge of support to Canada by then President Franklin Roosevelt.

Two years later, the formalization of this pledge created the Permanent Joint Board on Defence (PJBD), a binational forum for discussions on continental defence. In 1958, the alliance strengthened further with the birth of the North American Air (later Aerospace)  Defence Command (NORAD), the world’s only binational military command. The core objective of NORAD is the joint warning and defence of the North American continent as a whole, regardless of national borders, primarily from air-based threats. NORAD was also assigned a maritime warning mission in 2006.

Benefits for the U.S. 

For both Canada and Iceland, defence alliances with the United States are beneficial because of training opportunities, intelligence and access to defence capabilities. However, these relationships bring important benefits to the United States as well. The defence of both Canada and Iceland is a strategic choice for the US as Canadian and Icelandic geography facilitate the defence of its territory by extending its reach beyond American borders.

As Arctic countries, Canada and Iceland are potential avenues of attack on North America. In fact, the Arctic is considered the fastest avenue of approach to and from many countries, including Russia. Broadening the  US  military presence to span multiple Arctic locations is therefore strategically advantageous. Canada and its radar systems provide the United States with advanced warning of potential air and missile threats while Iceland is located in a strategically important intersection between the North Atlantic and Arctic Oceans.

What is Next?

In response to recent US policies, many NATO states have begun prioritizing strengthening bilateral relations with one another. This may not be a priority for Canada and Iceland just yet, given their reliance on the United States, their geographic distance from Russia compared to EU members, and their strong relations with the US overall. Canada in particular is intrinsically connected to its Southern neighbour economically, geographically, and culturally. Maintaining an alliance with the US is important for Iceland, too, especially given that the country is neither a member of the European Union nor part of mainland Europe.

NATO’s Defence Spending Target

President Trump’s push for a 5% GDP minimum for NATO allies has seen success in increasing commitment to defence spending across the alliance. Of the 5%, 3.5% are to be dedicated to core defence spending, and 1.5% towards non-military costs such as infrastructure and cybersecurity. Canada is set to reach the new 5% target by 2035, which can be perceived as a shift towards diversifying defence and security partners. Meanwhile, Iceland is set to reach 1.5% in non-military defence spending by the same year as Reykjavík does not have a national military force.

Collaborations Outside Government

In recent years, shared security and defence concerns between Canada and Iceland have brought together a wide range of professionals. For example, the annual Canada-Iceland Seminar is a collaboration between the Centre for Defence and Security Studies at the University of Manitoba, the North American and Arctic Defence and Security Network, and the Institute for International Affairs at the University of Iceland. The event has had four iterations so far, rotating between Ottawa and Reykjavík, and its themes have focused on the effects of changing global dynamics on the North. Its 2025 conference, “Geopolitics and Security in the Arctic and North Atlantic”, was a discussion of the United States nearly as much as it was a discussion of the participating countries, reflecting the broader trend of Canadian and Icelandic defence discourse. This collaborative approach, a hallmark of Canadian and Icelandic foreign policies, is helping countries adapt to new and ongoing defence challenges brought upon by global uncertainty.