Iceland
Republic of IcelandLydveldid Island
constitutional republic
Iceland as the 2011 edition of the CIA World Factbook published it: 145 fields, one of 36 editions from 1990 to 2025.
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Introduction
1 fieldBackground
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
Northern Europe, island between the Greenland Sea and the North Atlantic Ocean, northwest of the United Kingdom
20 fieldsLand useshare of 103,000 sq km
Location
Northern Europe, island between the Greenland Sea and the North Atlantic Ocean, northwest of the United Kingdom
Terrain
mostly plateau interspersed with mountain peaks, icefields; coast deeply indented by bays and fiords
Freshwater withdrawal (domestic/industrial/agricultural)
- total:
- 0.17 cu km/yr (34%/66%/0%)
- per capita:
- 567 cu 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
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
31 fieldsAge structuremale left, female right · (2011 est.)
Per 1,000 population
Male · female
Religions(2006 est.)
Ethnic groups
homogeneous mixture of descendants of Norse and Celts 94%, population of foreign origin 6%
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.)
HIV/AIDS - people living with HIV/AIDS
fewer than 1,000 (2009 est.) country comparison to the world: 142
Government
Constitutional republic; President Olafur Ragnar GRIMSSON (since 1 August 1996); Prime Minister Johanna SIGURDARDOTTIR (since 1 February 2009)
20 fieldsPresidential electionpercent of vote
Legislature, 63 seats, elected 25 April 2009one dot, one seat
Percent of vote
Country name
- conventional long form:
- Republic of Iceland
- conventional short form:
- Iceland
- local long form:
- Lydveldid Island
- local short form:
- Island
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)
International law organization participation
has not submitted an ICJ jurisdiction declaration; accepts ICCt jurisdiction
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 theWorld 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 Gudmundur A. STEFANSSON
- 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 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
Iceland's Scandinavian-type social-market economy combines a capitalist structure and free-market principles with an extensive welfare system.
53 fieldsGDP - composition by sector(2010 est.)
Trading partnersexports left, imports right
Electricity
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.
Distribution of family income - Gini index
28 (2006) · 25 (2005) country comparison to the world: 126
Central bank discount rate
5.75% (31 December 2010 est.) · 14.55% (31 December 2009 est.) country comparison to the world: 16
Commercial bank prime lending rate
10.242% (31 December 2010 est.) · 19% (31 December 2009 est.) country comparison to the world: 29
Stock of narrow money
$5.276 billion (31 December 2010 est.) · $4.384 billion (31 December 2009 est.) country comparison to the world: 88
Stock of broad money
$30.39 billion (31 December 2009 est.) · $24.01 billion (31 December 2009 est.) country comparison to the world: 74
Stock of domestic credit
$69.71 billion (31 December 2010 est.) · $54.05 billion (31 December 2009 est.) country comparison to the world: 57
Industries
- fish processing;
- aluminum smelting, ferrosilicon production;
- geothermal power, hydropower, tourism
Current account balance
-$973 million (2010 est.) · -$1.436 billion (2009 est.) country comparison to the world: 130
Reserves of foreign exchange and gold
$5.79 billion (31 December 2010 est.) · $3.883 billion (31 December 2009 est.) country comparison to the world: 83
Exchange rates
Icelandic kronur (ISK) per US dollar - 139.32 (2010) · 123.64 (2009) · 85.619 (2008) · 63.391 (2007) · 70.195 (2006)
Communications
7 fieldsTelephone system
- general assessment:
- telecommunications infrastructure is modern and fully digitized, with satellite-earth stations, fiber-optic cables, and an extensive broadband network
- domestic:
- liberalization of the telecommunications sector beginning in the late 1990s has led to increased competition especially in the mobile services segment of the market
- international:
- country code - 354;
- the CANTAT-3 and FARICE-1 submarine cable systems provide connectivity to Canada, the Faroe Islands, UK, Denmark, and Germany;
- a planned new section of the Hibernia-Atlantic submarine cable will provide additional connectivity to Canada, US, and Ireland;
- satellite earth stations - 2 Intelsat (Atlantic Ocean), 1 Inmarsat (Atlantic and Indian Ocean regions);
- note - Iceland shares the Inmarsat earth station with the other Nordic countries (Denmark, Finland, Norway, and Sweden)
Broadcast media
- state-owned public television broadcaster operates 1 TV channel nationally;
- several privately-owned TV stations broadcast nationally and roughly another half-dozen operate locally;
- about half the households utilize multi-channel cable or satellite TV services;
- state-owned public radio broadcaster operates 2 national networks and 4 regional stations;
- 2 privately-owned radio stations operate nationally and another 15 provide more limited coverage (2007)
Transportation
6 fieldsAirports by runway lengthunpaved only
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)
Military
No regular military forces; Icelandic National Police (2008)
6 fieldsMilitary - 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
1 fieldDisputes - international
Iceland, the UK, and Ireland dispute Denmark's claim that the Faroe Islands' continental shelf extends beyond 200 nm
Cite this entry
Central Intelligence Agency. “Iceland.” The World Factbook 2011. Archived by The Factbook, thefactbook.org/iceland/2011.