Iceland Economy

Iceland Economy and Culture


The nature of the land and the climatic aspects limit the presence of agricultural areas: poor soils and an unsuitable climate make cereal cultivation uneconomical; the arable land is reserved essentially only for potatoes (which grow in the sunniest areas) and for forage; characteristic of the country is the cultivation in greenhouses (heated, like buildings, using the water of the geysers) of vegetables, fruit, flowers. According to smber, the breeding mainly concerns sheep, which are satisfied with poor pastures, and fur animals; the transition from cereal to fodder crops, however, allowed for a certain expansion of cattle breeding: the country is self-sufficient in meat and dairy products. Pony horses are still used for internal transport. However, the economy is actually based on fishing. This activity, organized modernly with a well-equipped flotilla, exploits the fish-rich coastal seas: mainly cod and herring are fished, while whaling, once very important, is of little importance due to the almost total disappearance of cetaceans from the Arctic seas. The aquaculture of salmon has had moderate developments.


The mineral resources are modest; in particular there is a complete lack of fuels. The waters of the geysers partially meet the energy needs; the hydroelectric potential is also significant (the electricity produced in the country is in fact of water origin for about 84% and geothermal for about 16%), whose increased exploitation was a fundamental element for the strengthening of industry. In the My’vatn thermal region is extracted diatomite. § Industry largely contributes to GDP (24.2%); it is eminently based on the processing of fish (oil and fish meal, in addition to the canning industry). There are also some cement factories, textile companies (wool mills are expanding), tanneries, shoe factories, fertilizer industries and metallurgical complexes: iron-silicon productions, especially those made of aluminum. Thanks to the available electric potential, a contract was signed in 1987 for the supply of electricity to Great Britain, implemented via an almost 1000 km long submarine cable. During the last decade of the twentieth century, great progress was made in the production of sophisticated technologies for fishing, in products intended for the nautical sector and in the applications of information technology in the various production phases of these sectors.


Internal terrestrial communications are made difficult, in various places almost impossible, due to the presence of large glacial masses; the railways are totally lacking, but there is a road network, which makes the entire circumnavigation of the island and is crossed by regular bus services. Internal trade, especially for heavy goods, is mainly carried out by ships, which operate cabotage between the capital Reykjavík and the main coastal centers. Air communications have undergone rapid development in recent decades. They are insured by Icelandair. The main airport is the international airport of Keflavík, approx. 50 km from the capital. Foreign trade clearly reveals the weakness of the Icelandic economy. 3/4 of exports consist of fish, frozen and salted, and its derivatives; aluminum, some zootechnical products (wool, skins, meat) and the textile industry follow; imports are essentially represented by fuels, numerous industrial products (pharmaceuticals, electronics, etc.), machinery and means of transport, foodstuffs, certain raw materials (bauxite and other minerals, timber, etc.). The exchange takes place mainly with Germany, Great Britain, the USA, the Netherlands and Denmark. The services of the commercial and administrative tertiary sector and those of the political and scientific quaternary are concentrated exclusively in the urban area of ​​the capital. As regards the new information and communication technologies, Iceland occupies a position of excellence. The ability to know how to exploit ICT (Information and Communication Technologies) to make a contribution to national and socio-economic development places the country in second place worldwide, after the USA, according to a ranking prepared by the World Economic Forum (WEF) and the University of Harvard (2002).


Over the centuries, the rugged Icelandic territory has seen the birth of a proud and independent culture, which speaks of farmers and fishermen but also of courageous warriors and industrious people, who have arrived in a young country to be colonized where it is still possible to admire more than the vestiges. of ancient Viking dwellings of which only the foundations remain, solid settlements of peat-roofed farms, now transformed into folk art museums (such as those of Keldur in southwestern Iceland, or of Glaumbær and Laufás in the northern part of the island). Icelanders, supremely proud of their land and their independence, still use the ancient names of the months and count the age of the horses in winters instead of years, in memory of the time when only summer and winter marked life. and time. son (son) for males, dottir (daughter) for females: only 10% of the population has a real surname, which generally dates back to the colonization era. But the government is trying to eliminate existing surnames, in order to standardize the system whereby Icelanders cannot take either a new surname or that of their spouse. Officially Christian, Iceland has seen since the seventies of the century. XX onwards a considerable return of the ancient Scandinavian religion Ásatrú (literally “faith in the æsir ”, Deity of pre-Christian Scandinavia). The cult, originating from the Germanic peoples, in its modern form attaches great importance to the strength and harmony of nature, of which the ancient divinities would be the magical representation. § There are three major universities in Iceland: the University College of Education and the University of Iceland, both in Reykjavík, as well as the University of Akureyri.

Iceland Economy