Iceland

Iceland

Introduction

Background

Settled by Norwegian and Celtic (Scottish and Irish) immigrants during the late 9th and 10th centuries A.D., Iceland boasts the world’s oldest functioning legislative assembly, the Althing, established in 930. Independent for over 300 years, Iceland was subsequently ruled by Norway and Denmark. Fallout from the Askja volcano of 1875 devastated the Icelandic economy and caused widespread famine. Over the next quarter century, 20% of the island’s population emigrated, mostly to Canada and the US. Limited home rule from Denmark was granted in 1874 and complete independence attained in 1944. The second half of the 20th century saw substantial economic growth driven primarily by the fishing industry. The economy diversified greatly after the country joined the European Economic Area in 1994, but Iceland was especially hard hit by the global financial crisis in the years following 2008. Literacy, longevity, and social cohesion are first rate by world standards.

Geography

Location

Northern Europe, island between the Greenland Sea and the North Atlantic Ocean, northwest of the United Kingdom

Geographic coordinates

65 00 N, 18 00 W

Map references

Europe

Area

total: 103,000 sq km
country comparison to the world: 108 land:100,250 sq km
water:2,750 sq km

Area – comparative

slightly smaller than Kentucky

Land boundaries

0 km

Coastline

4,970 km

Maritime claims

territorial sea: 12 nm
exclusive economic zone:200 nm
continental shelf:200 nm or to the edge of the continental margin

Climate

temperate

moderated by North Atlantic Current

mild, windy winters

damp, cool summers

Terrain

mostly plateau interspersed with mountain peaks, icefields

coast deeply indented by bays and fiords

Elevation extremes

lowest point: Atlantic Ocean 0 m
highest point:Hvannadalshnukur 2,110 m (at Vatnajokull glacier)

Natural resources

fish, hydropower, geothermal power, diatomite

Land use

arable land: 0.07%
permanent crops:0%
other:99.93% (2005)

Irrigated land

NA

Total renewable water resources

170 cu km (2005)

Freshwater withdrawal (domestic/industrial/agricultural)

total: 0.17cu km/yr (34%/66%/0%)
per capita:567cu m/yr (2003)

Natural hazards

earthquakes and volcanic activity
volcanism:Iceland, situated on top of a hotspot, experiences severe volcanic activity

Eyjafjallajokull (elev. 1,666 m) erupted in 2010, sending ash high into the atmosphere and seriously disrupting European air traffic

scientists continue to monitor nearby Katla (elev. 1,512 m), which has a high probability of eruption in the very near future, potentially disrupting air traffic

Grimsvoetn and Hekla are Iceland’s most frequently active volcanoes

other historically active volcanoes include Askja, Bardarbunga, Brennisteinsfjoll, Esjufjoll, Hengill, Krafla, Krisuvik, Kverkfjoll, Oraefajokull, Reykjanes, Torfajokull, and Vestmannaeyjar

Environment – current issues

water pollution from fertilizer runoff

inadequate wastewater treatment

Environment – international agreements

party to: Air Pollution, Air Pollution-Persistent Organic Pollutants, Biodiversity, Climate Change, Climate Change-Kyoto Protocol, Desertification, Endangered Species, Hazardous Wastes, Kyoto Protocol, Law of the Sea, Marine Dumping, Ozone Layer Protection, Ship Pollution, Transboundary Air Pollution, Wetlands, Whaling
signed, but not ratified:Environmental Modification, Marine Life Conservation

Geography – note

strategic location between Greenland and Europe

westernmost European country

Reykjavik is the northernmost national capital in the world

more land covered by glaciers than in all of continental Europe

People and Society

Nationality

noun: Icelander(s)
adjective:Icelandic

Ethnic groups

homogeneous mixture of descendants of Norse and Celts 94%, population of foreign origin 6%

Languages

Icelandic, English, Nordic languages, German widely spoken

Religions

Lutheran Church of Iceland (official) 80.7%, Roman Catholic 2.5%, Reykjavik Free Church 2.4%, Hafnarfjorour Free Church 1.6%, other religions 3.6%, unaffiliated 3%, other or unspecified 6.2% (2006 est.)

Population

311,058 (July 2011 est.)
country comparison to the world: 179

Age structure

0-14 years: 20.2% (male 31,929/female 31,034)
15-64 years:67.1% (male 105,541/female 103,202)
65 years and over:12.7% (male 17,974/female 21,378) (2011 est.)

Median age

total: 35.6 years
male:35.2 years
female:36.1 years (2011 est.)

Population growth rate

0.687% (2011 est.)
country comparison to the world: 140

Birth rate

13.29 births/1,000 population (2011 est.)
country comparison to the world: 151

Death rate

6.96 deaths/1,000 population (July 2011 est.)
country comparison to the world: 136

Net migration rate

0.53 migrant(s)/1,000 population (2011 est.)
country comparison to the world: 63

Urbanization

urban population: 93% of total population (2010)
rate of urbanization:1.5% annual rate of change (2010-15 est.)

Major cities – population

REYKJAVIK (capital) 198,000 (2009)

Sex ratio

at birth: 1.04 male(s)/female
under 15 years:1.03 male(s)/female
15-64 years:1.02 male(s)/female
65 years and over:0.83 male(s)/female
total population:1 male(s)/female (2011 est.)

Maternal mortality rate

5 deaths/100,000 live births (2008)
country comparison to the world: 166

Infant mortality rate

total: 3.2 deaths/1,000 live births
country comparison to the world: 215 male:3.34 deaths/1,000 live births
female:3.05 deaths/1,000 live births (2011 est.)

Life expectancy at birth

total population: 80.9 years
country comparison to the world: 18 male:78.72 years
female:83.17 years (2011 est.)

Total fertility rate

1.89 children born/woman (2011 est.)
country comparison to the world: 141

Health expenditures

4.2% of GDP (2009)
country comparison to the world: 156

Physicians density

3.934 physicians/1,000 population (2008)
country comparison to the world: 13

Hospital bed density

5.79 beds/1,000 population (2007)
country comparison to the world: 29

Drinking water source

improved:
urban: 100% of population
rural: 100% of population
total: 100% of population (2008)

Sanitation facility access

improved:
urban: 100% of population
rural: 100% of population
total: 100% of population (2008)

HIV/AIDS – adult prevalence rate

0.3% (2009 est.)
country comparison to the world: 86

HIV/AIDS – people living with HIV/AIDS

fewer than 1,000 (2009 est.)
country comparison to the world: 143

HIV/AIDS – deaths

fewer than 100 (2009 est.)
country comparison to the world: 136

Obesity – adult prevalence rate

12.4% (2002)
country comparison to the world: 46

Education expenditures

7.4% of GDP (2007)
country comparison to the world: 14

Literacy

definition: age 15 and over can read and write
total population:99%
male:99%
female:99% (2003 est.)

School life expectancy (primary to tertiary education)

total: 18 years
male:17 years
female:20 years (2008)

Unemployment, youth ages 15-24

total: 16%
country comparison to the world: 72 male:19.9%
female:12% (2009)

Government

Country name

conventional long form: Republic of Iceland
conventional short form:Iceland
local long form:Lydveldid Island
local short form:Island

Government type

constitutional republic

Capital

name: Reykjavik
geographic coordinates:64 09 N, 21 57 W
time difference:UTC 0 (5 hours ahead of Washington, DC during Standard Time)

Administrative divisions

8 regions

Austurland, Hofudhborgarsvaedhi, Nordhurland Eystra, Nordhurland Vestra, Sudhurland, Sudhurnes, Vestfirdhir, Vesturland

Independence

1 December 1918 (became a sovereign state under the Danish Crown)

17 June 1944 (from Denmark)

National holiday

Independence Day, 17 June (1944)

Constitution

16 June 1944, effective 17 June 1944

amended many times

Legal system

civil law system influenced by the Danish model

International law organization participation

has not submitted an ICJ jurisdiction declaration

accepts ICCt jurisdiction

Suffrage

18 years of age

universal

Executive branch

chief of state: President Olafur Ragnar GRIMSSON (since 1 August 1996)
head of government:Prime Minister Johanna SIGURDARDOTTIR (since 1 February 2009)
cabinet:Cabinet appointed by the prime minister
(For more information visit the World Leaders website ) elections:president is elected by popular vote for a four-year term (no term limits)

election last held on 28 June 2004 (next to be held in June 2012)

note – the presidential election of 28 June 2008 was not held because Olafur Ragnar GRIMSSON had no challengers

he was sworn in on 1 August 2008

following legislative elections, the leader of the majority party or the leader of the majority coalition usually the prime minister
election results:Olafur Ragnar GRIMSSON elected president

percent of vote – Olafur Ragnar GRIMSSON 85.6%, Baldur AGUSTSSON 12.5%, Astthor MAGNUSSON 1.9%

Legislative branch

unicameral Althingi (parliament) (63 seats

members elected by popular vote to serve four-year terms)
elections:last held on 25 April 2009 (next to be held in 2013)
election results:percent of vote by party – Social Democratic Alliance 29.8%, Independence Party 23.7%, Left-Green Movement 21.7%, Progressive Party 14.8%, Citizens’ Movement 7.2%, other 2.8%

seats by party – Social Democratic Alliance 20, Independence Party 16, Left-Green Alliance 14, Progressive Party 9, Citizens’ Movement 4
note:the Citizens’ Movement disintegrated in September 2009

three of its former MPs are now represented under the banner of The Movement and the fourth former MP is an independent

Judicial branch

Supreme Court or Haestirettur (justices are appointed for life by the president)

eight district courts (justices are appointed for life by the president)

Political parties and leaders

Independence Party or IP [Bjarni BENEDIKTSSON]

Left-Green Movement or LGM [Steingrimur SIGFUSSON]

The Liberal Party [Sigurjon THORDARSON]

The Movement [Birgitta JONSDOTTIR]

Progressive Party or PP [Sigmundur David GUNNLAUGSSON]

Social Democratic Alliance or SDA [Johanna SIGURDARDOTTIR]

International organization participation

Arctic Council, Australia Group, BIS, CBSS, CE, EAPC, EBRD, EFTA, EU (candidate country), FAO, FATF, IAEA, IBRD, ICAO, ICC, ICRM, IDA, IFAD, IFC, IFRCS, IHO, ILO, IMF, IMO, IMSO, Interpol, IOC, IPU, ISO, ITSO, ITU, ITUC, MIGA, NATO, NC, NEA, NIB, NSG, OAS (observer), OECD, OPCW, OSCE, PCA, Schengen Convention, UN, UNCTAD, UNESCO, UPU, WCO, WHO, WIPO, WMO, WTO

Diplomatic representation in the US

chief of mission: Ambassador Hjalmar W. HANNESSON
chancery:House of Sweden, 2900 K Street NW #509, Washington, DC 20007
telephone:[1] (202) 265-6653
FAX:[1] (202) 265-6656
consulate(s) general:New York

Diplomatic representation from the US

chief of mission: Ambassador Luis E. ARREAGA
embassy:Laufasvegur 21, 101 Reykjavik
mailing address:US Department of State, 5640 Reykjavik Place, Washington, D.C. 20521-5640
telephone:[354] 562-9100
FAX:[354] 562-9118

Flag description

blue with a red cross outlined in white extending to the edges of the flag

the vertical part of the cross is shifted to the hoist side in the style of the Dannebrog (Danish flag)

the colors represent three of the elements that make up the island: red is for the island’s volcanic fires, white recalls the snow and ice fields of the island, and blue is for the surrounding ocean

National symbol(s)

gyrfalcon

National anthem

name: “Lofsongur” (Song of Praise)
lyrics/music:Matthias JOCHUMSSON/Sveinbjorn SVEINBJORNSSON
note:adopted 1944

the anthem, also known as “O, Guo vors Lands” (O, God of Our Land), was originally written and performed in 1874

Economy

Economy – overview

Iceland’s Scandinavian-type social-market economy combines a capitalist structure and free-market principles with an extensive welfare system. Prior to the 2008 crisis, Iceland had achieved high growth, low unemployment, and a remarkably even distribution of income. The economy depends heavily on the fishing industry, which provides 40% of export earnings, more than 12% of GDP, and employs 7% of the work force. It remains sensitive to declining fish stocks as well as to fluctuations in world prices for its main exports: fish and fish products, aluminum, and ferrosilicon. Iceland’s economy has been diversifying into manufacturing and service industries in the last decade, particularly within the fields of software production, biotechnology, and tourism. Abundant geothermal and hydropower sources have attracted substantial foreign investment in the aluminum sector and boosted economic growth, although the financial crisis has put several investment projects on hold. Much of Iceland’s economic growth in recent years came as the result of a boom in domestic demand following the rapid expansion of the country’s financial sector. Domestic banks expanded aggressively in foreign markets, and consumers and businesses borrowed heavily in foreign currencies, following the privatization of the banking sector in the early 2000s. Worsening global financial conditions throughout 2008 resulted in a sharp depreciation of the krona vis-a-vis other major currencies. The foreign exposure of Icelandic banks, whose loans and other assets totaled more than 10 times the country’s GDP, became unsustainable. Iceland’s three largest banks collapsed in late 2008. The country secured over $10 billion in loans from the IMF and other countries to stabilize its currency and financial sector, and to back government guarantees for foreign deposits in Icelandic banks. GDP fell 6.8% in 2009, and unemployment peaked at 9.4% in February 2009. GDP fell 3.4% in 2010. Since the collapse of Iceland’s financial sector, government economic priorities have included: stabilizing the krona, reducing Iceland’s high budget deficit, containing inflation, restructuring the financial sector, and diversifying the economy. Three new banks were established to take over the domestic assets of the collapsed banks. Two of them have foreign majority ownership, while the State holds a majority of the shares of the third. British and Dutch authorities have pressed claims totaling over $5 billion against Iceland to compensate their citizens for losses suffered on deposits held in the failed Icelandic bank, Landsbanki Islands. Iceland agreed to new terms with the UK and the Netherlands to compensate British and Dutch depositors, but the agreement must first be approved by the Icelandic President. Iceland began accession negotiations with the EU in July 2010

however, public support has dropped substantially because of concern about losing control over fishing resources and in reaction to measures taken by Brussels during the ongoing Eurozone crisis.

GDP (purchasing power parity)

$11.82 billion (2010 est.)
country comparison to the world: 145 $12.24 billion (2009 est.)
$13.15 billion (2008 est.)
note:data are in 2010 US dollars

GDP (official exchange rate)

$12.59 billion (2010 est.)

GDP – real growth rate

-3.5% (2010 est.)
country comparison to the world: 209 -6.9% (2009 est.)
1.4% (2008 est.)

GDP – per capita (PPP)

$38,300 (2010 est.)
country comparison to the world: 25 $39,900 (2009 est.)
$43,200 (2008 est.)
note:data are in 2010 US dollars

GDP – composition by sector

agriculture: 5.5%
industry:24.7%
services:69.8% (2010 est.)

Labor force

181,000 (2010 est.)
country comparison to the world: 174

Labor force – by occupation

agriculture: 4.8%
industry:22.2%
services:73% (2008)

Unemployment rate

8.1% (2010 est.)
country comparison to the world: 93 8% (2009 est.)

Population below poverty line

NA%

Household income or consumption by percentage share

lowest 10%: NA%
highest 10%:NA%

Distribution of family income – Gini index

28 (2006)
country comparison to the world: 126 25 (2005)

Investment (gross fixed)

13% of GDP (2010 est.)
country comparison to the world: 174

Budget

revenues: $5.322 billion
expenditures:$6.302 billion (2010 est.)

Taxes and other revenues

42.3% of GDP (2010 est.)
country comparison to the world: 34

Budget surplus (+) or deficit (-)

-7.8% of GDP (2010 est.)
country comparison to the world: 184

Public debt

126.3% of GDP (2010 est.)
country comparison to the world: 6 114.9% of GDP (2009 est.)

Inflation rate (consumer prices)

5.4% (2010 est.)
country comparison to the world: 154 12% (2009 est.)

Central bank discount rate

5.75% (31 December 2010 est.)
country comparison to the world: 16 14.55% (31 December 2009 est.)

Commercial bank prime lending rate

10.242% (31 December 2010 est.)
country comparison to the world: 29 19% (31 December 2009 est.)

Stock of narrow money

$5.276 billion (31 December 2010 est.)
country comparison to the world: 88 $4.384 billion (31 December 2009 est.)

Stock of broad money

$30.39 billion (31 December 2009 est.)
country comparison to the world: 74 $24.01 billion (31 December 2009 est.)

Stock of domestic credit

$69.71 billion (31 December 2010 est.)
country comparison to the world: 57 $54.05 billion (31 December 2009 est.)

Market value of publicly traded shares

$1.996 billion (31 December 2010)
country comparison to the world: 103 $1.128 billion (31 December 2009)
$5.557 billion (31 December 2008)

Agriculture – products

potatoes, green vegetables

mutton, chicken, pork, beef, dairy products

fish

Industries

fish processing

aluminum smelting, ferrosilicon production

geothermal power, hydropower, tourism

Industrial production growth rate

-1% (2010 est.)
country comparison to the world: 152

Electricity – production

16.48 billion kWh (2009 est.)
country comparison to the world: 76

Electricity – consumption

16.48 billion kWh (2009 est.)
country comparison to the world: 74

Electricity – exports

0 kWh (2009 est.)

Electricity – imports

0 kWh (2009 est.)

Oil – production

0 bbl/day (2010 est.)
country comparison to the world: 183

Oil – consumption

17,430 bbl/day (2010 est.)
country comparison to the world: 133

Oil – exports

1,209 bbl/day (2009 est.)
country comparison to the world: 116

Oil – imports

15,530 bbl/day (2009 est.)
country comparison to the world: 128

Oil – proved reserves

0 bbl (1 January 2011 est.)
country comparison to the world: 145

Natural gas – production

0 cu m (2010 est.)
country comparison to the world: 197

Natural gas – consumption

0 cu m (2010 est.)
country comparison to the world: 189

Natural gas – exports

0 cu m (2010 est.)
country comparison to the world: 114

Natural gas – imports

0 cu m (2010 est.)
country comparison to the world: 134

Natural gas – proved reserves

0 cu m (1 January 2011 est.)
country comparison to the world: 149

Current account balance

-$973 million (2010 est.)
country comparison to the world: 130 -$1.436 billion (2009 est.)

Exports

$4.603 billion (2010 est.)
country comparison to the world: 111 $4.05 billion (2009 est.)

Exports – commodities

fish and fish products 40%, aluminum, animal products, ferrosilicon, diatomite

Exports – partners

Netherlands 33.9%, Germany 14.1%, UK 10.1%, Spain 4.7%, US 4.5%, Norway 4.3% (2010)

Imports

$3.621 billion (2010 est.)
country comparison to the world: 131 $3.318 billion (2009 est.)

Imports – commodities

machinery and equipment, petroleum products, foodstuffs, textiles

Imports – partners

Norway 9%, Brazil 8.7%, Netherlands 8.5%, US 8.1%, Germany 7.5%, Denmark 7%, China 6%, Finland 5.4%, Sweden 5.2%, UK 5.1% (2010)

Reserves of foreign exchange and gold

$5.79 billion (31 December 2010 est.)
country comparison to the world: 83 $3.883 billion (31 December 2009 est.)

Debt – external

$124.5 billion (30 June 2011)
country comparison to the world: 36

Stock of direct foreign investment – at home

$NA (31 December 2010)
$9.2 billion (31 December 2008)

Stock of direct foreign investment – abroad

$NA
$8.8 billion (31 December 2008)

Exchange rates

Icelandic kronur (ISK) per US dollar -
139.32 (2010)
123.64 (2009)
85.619 (2008)
63.391 (2007)
70.195 (2006)

Transportation

Airports

99 (2010)
country comparison to the world:59

Airports – with paved runways

total: 6
over 3,047 m:1
1,524 to 2,437 m:3
914 to 1,523 m:2 (2010)

Airports – with unpaved runways

total: 93
1,524 to 2,437 m:3
914 to 1,523 m:27
under 914 m:63 (2010)

Roadways

total: 12,869 km
country comparison to the world: 128 paved/oiled gravel:4,438 km (does not include urban roads)
unpaved:8,431 km (2009)

Merchant marine

total: 2
country comparison to the world: 143 by type:passenger/cargo 2
registered in other countries:19 (Antigua and Barbuda 9, Belize 2, Denmark 3, Finland 1, Gibraltar 1, Norway 3) (2010)

Ports and terminals

Grundartangi, Hafnarfjordur, Reykjavik

Military

Military branches

no regular military forces

Icelandic National Police (2008)

Manpower available for military service

males age 16-49: 75,337 (2010 est.)

Manpower fit for military service

males age 16-49: 62,781
females age 16-49:61,511 (2010 est.)

Manpower reaching militarily significant age annually

male: 2,277
female:2,200 (2010 est.)

Military expenditures

0% of GDP (2005 est.)
country comparison to the world: 172

Military – note

Iceland has no standing military force

under a 1951 bilateral agreement – still valid – its defense was provided by the US-manned Icelandic Defense Force (IDF) headquartered at Keflavik

however, all US military forces in Iceland were withdrawn as of October 2006

although wartime defense of Iceland remains a NATO commitment, in April 2007, Iceland and Norway signed a bilateral agreement providing for Norwegian aerial surveillance and defense of Icelandic airspace (2008)

Transnational Issues

Disputes – international

Iceland, the UK, and Ireland dispute Denmark’s claim that the Faroe Islands’ continental shelf extends beyond 200 nm