Economy - overview Iceland's Scandinavian-type economy is basically capitalistic, yet with an extensive welfare system, low unemployment, and remarkably even distribution of income. In the absence of other natural resources (except for abundant hydrothermal and geothermal power), the economy depends heavily on the fishing industry, providing 70% of export earnings and employing 12% of the work force. The economy remains sensitive to declining fish stocks as well as to drops in world prices for its main exports: fish and fish products, aluminum, and ferrosilicon. The center-right government plans to continue its policies of reducing the budget and current account deficits, limiting foreign borrowing, containing inflation, revising agricultural and fishing policies, diversifying the economy, and privatizing state-owned industries. The government remains opposed to EU membership, primarily because of Icelanders' concern about losing control over their fishing resources. Iceland's economy has been diversifying into manufacturing and service industries in the last decade, and new developments in software production, biotechnology, and financial services are taking place. The tourism sector is also expanding, with the recent trends in ecotourism and whale watching. Growth has been remarkably steady over the past five years at 4%-5%.

GDP purchasing power parity - $6.85 billion (2000 est.)

GDP - real growth rate 4.3% (2000 est.)

GDP - per capita purchasing power parity - $24,800 (2000 est.)

GDP - composition by sector
agriculture: 15% (includes fishing 13%)
industry: 21%
services: 64% (1999 est.)

Population below poverty line NA%

Household income or consumption by percentage share
lowest 10%: NA%
highest 10%: NA%

Inflation rate (consumer prices) 3.5% (2000 est.)

Labor force 159,000 (2000)

Labor force - by occupation agriculture 5.1%, fishing and fish processing 11.8%, manufacturing 12.9%, construction 10.7%, other services 59.5% (1999)

Unemployment rate 1% (April 2001 est.)

Budget
revenues: $3.5 billion
expenditures: $3.3 billion, including capital expenditures of $467 million (1999)

Industries fish processing; aluminum smelting, ferrosilicon production, geothermal power; tourism

Industrial production growth rate 1.5% (2000 est.)

Electricity - production 7.549 billion kWh (2000)

Electricity - production by source
fossil fuel: 0.05%
hydro: 83.3%
other: 16.65% (2000)
nuclear: 0%

Electricity - consumption 7.02 billion kWh (2000)

Electricity - exports 0 kWh (2000)

Electricity - imports 0 kWh (2000)

Agriculture - products potatoes, turnips; cattle, sheep; fish

Exports $2 billion (f.o.b., 2000)

Exports - commodities fish and fish products 70%, animal products, aluminum, diatomite, ferrosilicon

Exports - partners EU 64% (UK 20%, Germany 13%, France 5%, Denmark 5%), US 15%, Japan 5% (1999)

Imports $2.2 billion (f.o.b., 2000)

Imports - commodities machinery and equipment, petroleum products; foodstuffs, textiles

Imports - partners EU 56% (Germany 12%, UK 9%, Denmark 8%, Sweden 6%), US 11%, Norway 10% (1999)

Debt - external $2.6 billion (1999)

Economic aid - donor $NA

Currency Icelandic krona (ISK)

Currency code ISK

Exchange rates Icelandic kronur per US dollar - 102.430 (January 2002), 97.425 (2001), 78.616 (2000), 72.335 (1999), 70.958 (1998), 70.904 (1997)

Fiscal year calendar year

NOTE: The information regarding Iceland on this page is re-published from the 2002 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Iceland Economy 2002 information contained here. All suggestions for corrections of any errors about Iceland Economy 2002 should be addressed to the CIA.