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Faroe Islands Economy Profile 2017

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Economy - overviewThe 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. Nominal GDP, measured in current prices, grew 8.0% in 2015 and 7.8% in 2016. The fisheries sector accounts for about 97% of exports and half of GDP. Dependence on fishing makes the economy vulnerable to price fluctuations. Unemployment is low, estimated at 2.5% in early 2017. Aided by an annual subsidy from Denmark, which amounts to about 4% of Faroese GDP, Faroese have a standard of living equal to that of Denmark.

For the first time in 8 years the Faroe Islands managed to generate a public budget surplus in 2016, a trend which is continuing in 2017. The local government intends to use this to reduce public debt, which reached 38% of GDP in 2015. Increasing public infrastructure investments are likely to lead to continued growth in the short term, but could contribute to an overheating of the economy. Signs of overheating led the Danish Central Bank in fall of 2016 to advise the Faroese local government to initiate measures to cool the economy, including postponing spending on infrastructure spending. The local government is planning to allocate part of the expected public surplus to a business cycle-equalization fund.
GDP (purchasing power parity)$2.001 billion (2014 est.)
$1.89 billion (2013 est.)
$1.608 billion (2013 est.)
GDP (official exchange rate)$2.765 billion (2010 est.)
GDP - real growth rate5.9% (2014 est.)
7.5% (2013 est.)
2.4% (2013 est.)
GDP - per capita (PPP)$40,000 (2014 est.)
Gross national saving25.7% of GDP (2012 est.)
25.2% of GDP (2011 est.)
25.9% of GDP (2010 est.)
GDP - composition by sectoragriculture: 18%
industry: 39%
services: 43% (2013 est.)
Population below poverty line4.2% (2012 est.)
Labor force28,900 (2015 est.)
Labor force - by occupationagriculture: 15%
industry: 15%
services: 70% (December 2016 est)
Unemployment rate2.8% (2016 est.)
2.9% (2015)
Household income or consumption by percentage sharelowest 10%: NA%
highest 10%: NA%
Distribution of family income - Gini index22.7 (2013 est.)
21.6 (2011 est.)
Budgetrevenues: $835.6 million
expenditures: $883.8 million
note: Denmark supplies the Faroe Islands with almost one-third of their public funds (2014)
Taxes and other revenues30.2% of GDP (2014 est.)
Budget surplus (+) or deficit (-)-1.7% of GDP (2014 est.)
Public debt35% of GDP (2014 est.)
Inflation rate (consumer prices)-0.3% (2016)
-1.7% (2015)
Agriculture - productsmilk, potatoes, vegetables, sheep, salmon, herring, mackerel and other fish
Industriesfishing, fish processing, tourism, small ship repair and refurbishment, handicrafts
Industrial production growth rate3.4% (2009 est.)
Exports$1.184 billion (2016 est.)
$1.019 billion (2015 est.)
Exports - commoditiesfish and fish products (97%) (2017 est.)
Exports - partnersRussia 25.9%, US 8.8%, UK 8.6%, Denmark 7.5%, Germany 5.3%, China 5.2%, Nigeria 5%, Norway 5%, Netherlands 4% (2015)
Imports$978.4 million (2016 est.)
$906.1 million (2015 est.)
Imports - commoditiesgoods for household consumption, machinery and transport equipment, fuels, raw materials and semi-manufactures, cars
Imports - partnersDenmark 27.7%, Norway 15.3%, Germany 10%, Netherlands 6.2%, China 6%, Sweden 4.7%, Turkey 4% (2015)
Debt - external$387.6 million (2012)
$274.5 million (2010)
Exchange ratesDanish kroner (DKK) per US dollar -
6.865 (2016 est.)
6.7236 (2015 est.)
5.6183 (2014 est.)
5.6125 (2013 est.)
5.79 (2012 est.)
Fiscal yearcalendar year

Source: CIA World Factbook
This page was last updated on July 9, 2017