The two countries have cooperated in many areas over the last decades and various bilateral cultural and educational activities are flourishing, including a Confucius school in University of Iceland.

The Iceland-China Cultural Society and the Iceland-China Trade Council are actively working on bilateral exchanges and cooperation between the two countries. A number of sister cities have been established, i.e. Baoding and Hafnafjordur, Wuhan and Kopavogur, Xianyang and Reykjanesbaer, and Changsha and Olfuss.

Two UN programs are being operated in Iceland: the United Nations University (UNU) Geothermal Training Programme and the UNU Fisheries Training Programme. So far the UNU Geothermal Training Programme has received over 70 Chinese engineers and UNU Fisheries Training Program some 20 Chinese.

In May 2008, members of the Icelandic Business Forum expressed their support to the victims of the Wenchuan Earthquake by making a group donation of RMB 500,000. With the great support of China Youth Development Foundation and the local government in Huidong, the donation was used in adding a brand-new school building to the primary school of Vande Village, Huidong County, Liangshan Yi Autonomous Prefecture of Sichuan Province.  A special Binghua Hope Award was also set up for students at the newly-named Binghua Hope Primary School.

The signing of Iceland-China Free Trade Agreement in 2013 marked a new development of bilateral relations, laying a new foundation for increased trade, enhanced interest in various exchanges for new opportunities and expanded cooperation beyond economic sector.  Chinese tourists to Iceland, as an example, has jumped from about 18,000 in 2013 to about 86,000 in 2017.  Jeely also invested in an Icelandic company Carbon Recycling International (CRI) in developing new energy vehicle.