Faroe Islands Economy - 2006

Economy - overview:
The Faroese economy has had a strong performance since 1994, mostly as a result of increasing fish landings and high and stable export prices. Unemployment is minimal and there are signs of labor shortages in several sectors. The positive economic development has helped the Faroese Home Rule Government produce increasing budget surpluses, which in turn have helped reduce the large public debt, most of it owed to Denmark. However, the total dependence on fishing makes the Faroese economy extremely vulnerable, and the present fishing efforts appear in excess of what is a sustainable level of fishing in the long term. Oil finds close to the Faroese area give hope for deposits in the immediate Faroese area, which may eventually lay the basis for a more diversified economy and thus lessen dependence on Danish economic assistance. Aided by a substantial annual subsidy (about 15% of GDP) from Denmark, the Faroese have a standard of living not far below the Danes and other Scandinavians.

GDP (purchasing power parity):
$1 billion (2001 est.)

GDP (official exchange rate):
NA

GDP - real growth rate:
10% (2001 est.)

GDP - per capita (PPP):
$22,000 (2001 est.)

GDP - composition by sector:
agriculture: 27%
industry: 11%
services: 62% (1999)

Labor force:
24,250 (October 2000)

Labor force - by occupation:
agriculture: 33%
industry: 33%
services: 34%

Unemployment rate:
1% (October 2000)

Population below poverty line:
NA%

Household income or consumption by percentage share:
lowest 10%: NA%
highest 10%: NA%

Inflation rate (consumer prices):
5.1% (1999)

Budget:
revenues: $488 million
expenditures: $484 million; including capital expenditures of $21 million (1999)

Agriculture - products:
milk, potatoes, vegetables; sheep; salmon, other fish

Industries:
fishing, fish processing, small ship repair and refurbishment, handicrafts

Industrial production growth rate:
8% (1999 est.)

Electricity - production:
260.2 million kWh (2003)

Electricity - consumption:
242 million kWh (2003)

Electricity - exports:
0 kWh (2003)

Electricity - imports:
0 kWh (2003)

Oil - production:
0 bbl/day (2003 est.)

Oil - consumption:
4,500 bbl/day (2003 est.)

Oil - exports:
NA bbl/day

Oil - imports:
NA bbl/day

Natural gas - production:
0 cu m (2003 est.)

Natural gas - consumption:
0 cu m (2003 est.)

Exports:
$533 million f.o.b. (2004 est.)

Exports - commodities:
fish and fish products 94%, stamps, ships (1999)

Exports - partners:
Denmark 33.5%, UK 29.7%, Norway 8.4%, Nigeria 7.1% (2004)

Imports:
$639 million c.i.f. (2004 est.)

Imports - commodities:
consumer goods 36%, raw materials and semi-manufactures 32%, machinery and transport equipment 29%, fuels, fish, salt (1999)

Imports - partners:
Denmark 52.5%, Norway 18.2%, Iceland 5%, Sweden 4.2% (2004)

Debt - external:
$64 million (1999)

Economic aid - recipient:
$135 million (annual subsidy from Denmark) (1998)

Currency (code):
Danish krone (DKK)

Exchange rates:
Danish kroner per US dollar - 5.9969 (2005), 5.9911 (2004), 6.5877 (2003), 7.8947 (2002), 8.3228 (2001)