CIA - The World Factbook

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. Literacy, longevity, and social cohesion are first-rate by world standards.

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

slightly smaller than Kentucky

temperate; moderated by North Atlantic Current; mild, windy winters; damp, cool summers

mostly plateau interspersed with mountain peaks, icefields; coast deeply indented by bays and fiords

fish, hydropower, geothermal power, diatomite

earthquakes and volcanic activity

water pollution from fertilizer runoff; inadequate wastewater treatment

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

306,694 (July 2009 est.)

13.43 births/1,000 population (2009 est.)

6.85 deaths/1,000 population (July 2009 est.)

0.83 migrant(s)/1,000 population (2009 est.)

1.9 children born/woman (2009 est.)

fewer than 100 (2003 est.)

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

Lutheran Church of Iceland 80.7%, Roman Catholic Church 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.)

Icelandic, English, Nordic languages, German widely spoken

constitutional republic

8 regions; Austurland, Hofudhborgarsvaedhi, Nordhurland Eystra, Nordhurland Vestra, Sudhurland, Sudhurnes, Vestfirdhir, Vesturland

1 December 1918 (became a sovereign state under the Danish Crown); 17 June 1944 (from Denmark)

Independence Day, 17 June (1944)

16 June 1944, effective 17 June 1944; amended many times

civil law system based on Danish law; has not accepted compulsory ICJ jurisdiction

18 years of age; universal

unicameral Parliament or Althing (63 seats; members are elected by popular vote to serve four-year terms)

Supreme Court or Haestirettur (justices are appointed for life by the Minister of Justice); eight district courts (justices are appointed for life by the Minister of Justice)

Citizens' Movement; Independence Party or IP [Bjarni BENEDIKTSSON, Jr.]; Left-Green Movement or LGM [Steingrimur SIGFUSSON]; Liberal Party or LP [Gudjon KRISTJANSSON]; Progressive Party or PP [Sigmundur David GUNNLAUGSSON; Social Democratic Alliance or SDA [Johanna SIGUROARDOTTIR] (includes People's Alliance or PA, Social Democratic Party or SDP, Women's List)

People's Voices [Hordur TORFARSON]; New Times; Civic Action Association [Gunnar SIGURDSSON]; The Association of Military Opponents [Stefan PALSSON]

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

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)

Iceland's Scandinavian-type social-market economy combines a capitalist structure and free-market principles with an extensive welfare system, including generous housing subsidies. Prior to the 2008 crisis, Iceland had achieved high growth, low unemployment, and a remarkably even distribution of income. Government economic priorities have included stabilizing the krona, reducing the current account deficit, containing inflation, restructuring the financial sector, and diversifying the economy. The economy depends heavily on the fishing industry, which provides 40% of export earnings and employs 5% 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, with new developments in software production, biotechnology, and tourism. Abundant geothermal sources have attracted substantial foreign investment in the aluminum and hydropower sectors 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-currency loans, following the privatization of the 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 negotiated over $10 billion in loans from the IMF and other countries to stabilize its currency and financial sector, and to guarantee foreign deposits in Icelandic banks. A protracted recession is expected in 2009 and 2010 with GDP likely to contract and unemployment likely to surpass 10%. The collapse of the financial system has led to a major shift in opinion in favor of joining the EU and adopting the euro. Previous opposition to this move stemmed from Icelanders' concern about losing control of their fishing resources. Iceland's coalition government collapsed in January 2009 following protests over growing joblessness and losses to personal savings.

$12.15 billion (2008 est.)

$12.59 billion (2007)

$12.01 billion (2006)

$19.02 billion (2008 est.)

21.9% of GDP (2008 est.)

23% of GDP (2008 est.)

NA% (31 December 2008)

15.25% (31 December 2007)

NA% (31 December 2008)

19.29% (31 December 2007)

$NA (31 December 2008)

$6.64 billion (31 December 2007)

$15.05 billion (31 December 2006)

$NA (31 December 2007)

$NA (31 December 2008)

$49.67 billion (31 December 2006)

$40.56 billion (31 December 2007)

potatoes, green vegetables; mutton, dairy products; fish

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

11.71 billion kWh (2007 est.)

9.312 billion kWh (2006 est.)

0 bbl/day (2007 est.)

21,120 bbl/day (2007 est.)

860.8 bbl/day (2005)

17,450 bbl/day (2005)

0 bbl (1 January 2006 est.)

0 cu m (1 January 2006 est.)

$-3.257 billion (2008 est.)

$6.846 billion f.o.b. (2008 est.)

fish and fish products 70%, aluminum, animal products, ferrosilicon, diatomite

Netherlands 21.3%, Germany 13.3%, UK 13.2%, Ireland 7.7%, US 7.3%, Spain 4.6%, Japan 4.3% (2007)

$6.543 billion f.o.b. (2008 est.)

machinery and equipment, petroleum products, foodstuffs, textiles

US 13.7%, Germany 12.2%, Sweden 10.2%, Denmark 7.5%, Netherlands 5.7%, UK 5.4%, China 5.1%, Norway 4.6% (2007)

$2.5 billion (31 December 2008 est.)

$3.073 billion (2002)

Icelandic kronur (ISK) per US dollar - 85.619 (2008 est.), 63.391 (2007), 70.195 (2006), 62.982 (2005), 70.192 (2004)

AM 3, FM about 70, shortwave 1 (2008)

14 (plus 156 repeaters) (1997)

Grundartangi, Hafnarfjordur, Reykjavik

no regular military forces; Icelandic National Police (2008)

0% of GDP (2005 est.)

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)

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