Economy of Iceland

Economy of Iceland
	Reykjavík
Currency	Icelandic króna (ISK, kr)
Fiscal year	Calendar year
Trade organisations	EFTA, EEA, OECD, WTO
Country group	Advanced economy; High-income economy;
Statistics
Population	400,000 (2024)
GDP	$35.38 billion (nominal, 2025); $31.53 billion (PPP, 2025);
GDP rank	112th (nominal, 2023); 149th (PPP, 2023);
GDP growth	4.1% (2023); 1.7% (2024); 2.0% (2025);
GDP per capita	$90,110 (nominal, 2025); $80,320 (PPP, 2025);
GDP per capita rank	8th (nominal, 2023); 14th (PPP, 2023);
GDP by sector	manufacturing: 10.7%; real estate: 10.4%; wholesale: 9.0%; (2023 est.);
Inflation (CPI)	8.74% (2023 est.)
Population below poverty line	4.9% – income below 1,200€/ month (2021); 9.0% at risk of poverty or social exclusion (2023);
Gini coefficient	70.3 (2021)
Human Development Index	0.972 very high (2025) (1st); 0.910 very high IHDI (1st) (2022);
Corruption Perceptions Index	77 out of 100 points (2024) (10th)
Labour force	240,000 (2023 est.); 85.3% employment rate (2023) ;
Labour force by occupation	agriculture: 3.8%; industry: 21.1%; services: 64.4%; (2023 est.) ;
Unemployment	3.56% (2023 est.); 9.6% youth unemployment (15 to 24 year-olds; July 2020);
Average gross salary	804,000 ISK / €5,500 month (2023)
Average net salary	578,000 ISK / €4,000 month (2023)
Main industries	tourism, fish processing; aluminum smelting; geothermal power, hydropower; medical/pharmaceutical products
External
Exports	$7.31 billion (2023 est)
Export goods	raw aluminium, fish fillets, non-fillet frozen fish, and orthopedic appliances (2023)
Main export partners	Netherlands $1.97B; Germany $771M; United States $735M; United Kingdom $607M; Norway $444M; (2023);
Imports	$9.85 billion (2023 est.)
Import goods	refined petroleum, cars, carbon-based electronics, aluminium oxide, and computers (2023)
Main import partners	Norway $1.11B; China $908M; Germany $903M; Netherlands $745M; United States $694M; (2023);
FDI stock	$8.3 billion (2023 est.); Abroad: $5.23 billion (2023 est.);
Current account	$385 million (2023 est.)
Gross external debt	$25.3 billion (September 2024 est.)
Public finances
Government debt	95.9% of GDP (2023 est.)
Foreign reserves	902.4 billion kr (2025 est.)
Budget balance	0.6% (of GDP) (2023 est.)
Revenues	274 billion kr (2022 est.)
Expenses	1,930.7 billion kr (2023 est.)
Economic aid	c. $71.9 million (0.35% GDP, 2022 budget)
Credit rating	Moody's Investors Service A-2 (Foreign); A-2 (Domestic); Outlook: Stable; Standard & Poor's A (Foreign); A (Domestic); Outlook: Stable; Fitch A (Foreign); A (Domestic); Outlook: Stable;
	All values, unless otherwise stated, are in US dollars.

The economy of Iceland is small and subject to high volatility. In 2011, the gross domestic product was US$12 billion, but by 2018 it had increased to a nominal GDP of US$27 billion. With a population of 387,000, this is $55,000 per capita, based on purchasing power parity (PPP) estimates. The 2008–2011 Icelandic financial crisis produced a decline in GDP and employment, which has since been reversed entirely by a recovery aided by a tourism boom starting in 2010. Tourism accounted for more than 10% of Iceland's GDP in 2017. After a period of robust growth, Iceland's economy slowed down according to an economic outlook for the years 2018–2020 published by Arion Research in April of 2018.

Iceland has a mixed economy with high levels of free trade and government intervention. However, government consumption is less than other Nordic countries. Hydro-power is the primary source of home and industrial electrical supply in Iceland.

In the 1990s Iceland undertook extensive free market reforms, which initially produced strong economic growth. As a result, Iceland was rated as having one of the world's highest levels of economic freedom as well as civil freedoms. In 2007, Iceland topped the list of nations ranked by Human Development Index and was one of the most egalitarian, according to the calculation provided by the Gini coefficient.

From 2006 onwards, the economy faced problems of growing inflation and current account deficits. Partly in response, and partly as a result of earlier reforms, the financial system expanded rapidly before collapsing entirely in the 2008–2011 Icelandic financial crisis. Iceland had to obtain emergency funding from the International Monetary Fund and a range of European countries in November 2008. The economy has since rebounded since 2010, and continues to grow to this day.