Faroe Islands Economy
Is Faroe Islands a rich country?
The Faroese economy has experienced a period of significant growth since 2011, due to higher fish prices and increased salmon farming and catches in the pelagic fisheries. Fishing has been the main source of income for the Faroe Islands since the late 19th century, but dependence on fishing makes the economy vulnerable to price fluctuations. Nominal GDP, measured in current prices, grew 5.6% in 2015 and 6.8% in 2016. GDP growth was forecast at 6.2% in 2017, slowing to 0.5% in 2018, due to lower fisheries quotas, higher oil prices and fewer farmed salmon combined with lower salmon prices. The fisheries sector accounts for about 97% of exports, and half of GDP. Unemployment is low, estimated at 2.1% in early 2018. Aided by an annual subsidy from Denmark, which amounts to about 11% of Faroese GDP , Faroese have a standard of living equal to that of Denmark. The Faroe Islands have bilateral free trade agreements with the EU, Iceland, Norway, Switzerland, and Turkey.
For the first time in 8 years, the Faroe Islands managed to generate a public budget surplus in 2016, a trend which continued in 2017. The local government intends to use this to reduce public debt, which reached 38% of GDP in 2015. A fiscal sustainability analysis of the Faroese economy shows that a long-term tightening of fiscal policy of 5% of GDP is required for fiscal sustainability.
Increasing public infrastructure investments are likely to lead to continued growth in the short term, and the Faroese economy is becoming somewhat more diversified. Growing industries include financial services, petroleum-related businesses, shipping, maritime manufacturing services, civil aviation, IT, telecommunications, and tourism.
Faroe Islands Economy Data
What is the GDP of Faroe Islands?
| Currency Name and Code | Danish kroner (DKK) |
| GDP - Gross Domestic Product (PPP) | $2,001,000,000 (USD) |
| GDP - official exchange rate | $2,765,000,000 (USD) |
| GDP - real growth rate | 5.9% |
| GDP Per Capita | $40,000.00 (USD) |
| GDP by Sector- agriculture | 18% |
| GDP by Sector- Industry | 39% |
| GDP by Sector- services | 43% |
| GDP - composition, by end use |
household consumption: 52% (2013) government consumption: 29.6% (2013) investment in fixed capital: 18.4% (2013) |
| Population Below Poverty Line | 10% |
| Inflation Rate | -0.3% |
| Labor Force | 27,540 |
| Labor Force By Occupation- agriculture | 15% |
| Labor Force By Occupation- industry | 15% |
| Labor Force By Occupation- services | 70% |
| Unemployment Rate | 2.2% |
| Fiscal Year | calendar year |
| Annual Budget | $835,600,000 (USD) |
| Budget Surplus or Deficit - percent of GDP | -1.7% |
| Public Debt (% of GDP) | 35% |
| Taxes and other revenues - percent of GDP | 30.2% |
| Major Industries | fishing, fish processing, tourism, small ship repair and refurbishment, handicrafts |
| Industrial Growth Rate | 3.4% |
| Agriculture Products | milk, potatoes, vegetables, sheep, salmon, herring, mackerel and other fish |
| Exchange Rate per US Dollar | 6.586 |