Faroe Islands - Economic Indicators

Economic Overview

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. 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...

Continue reading View Factbook for Faroe Islands

Trade Reference Last Previous Units Frequency
Exports of Goods 2011 1,005,991,137 835,113,982 USD Annual
Current Account Balance 2011 194,304,400 144,276,278 USD Annual
Balance of Goods 2011 56,966,108 90,419,571 USD Annual
Imports of Goods 2011 949,025,028 744,694,411 USD Annual
Demographics Reference Last Previous Units Frequency
Birth Rate 2015 12.4 13.2 # per Ths. pop. Annual
Death Rate 2015 7.7 8.1 # per Ths. pop. Annual

Factbook

Background

Background:
The population of the Faroe Islands is largely descended from Viking settlers who arrived in the 9th century. The islands have been connected politically to Denmark since the 14th century. A high degree of self-government was granted the Faroese in 1948, who have autonomy over most internal affairs while Denmark is responsible for justice, defense, and foreign affairs. The Faroe Islands are not part of the European Union.

Geography

Location:
Northern Europe, island group between the Norwegian Sea and the North Atlantic Ocean, about halfway between Iceland and Norway
Geographic coordinates:
62 00 N, 7 00 W
Map references:
Europe
Area:
total: 1,393 sq km
land: 1,393 sq km
water: 0 sq km (some lakes and streams)
country comparison to the world: 183
Area - comparative:
eight times the size of Washington, DC
Land boundaries:
0 km
Coastline:
1,117 km
Maritime claims:
territorial sea: 12 nm
continental shelf: 200 nm or agreed boundaries or median line
exclusive fishing zone: 200 nm or agreed boundaries or median line
Climate:
mild winters, cool summers; usually overcast; foggy, windy
Terrain:
rugged, rocky, some low peaks; cliffs along most of coast
Elevation:
mean elevation: NA
elevation extremes: lowest point: Atlantic Ocean 0 m
highest point: Slaettaratindur 882 m
Natural resources:
fish, whales, hydropower, possible oil and gas
Land use:
agricultural land: 2.1%
arable land 2.1%; permanent crops 0%; permanent pasture 0%
forest: 0.1%
other: 97.8% (2011 est.)
Population - distribution:
the island of Streymoy is by far the most populous with over 40% of the population; it has approximately twice as many inhabitants as Eysturoy, the second most populous island; seven of the inhabited islands have fewer than 100 people
Natural hazards:
strong winds and heavy rains can occur throughout the year
Environment - current issues:
coastal erosion, landslides and rockfalls, flash flooding, wind storms; oil spills
Environment - international agreements:
party to: Marine Dumping - associate member to the London Convention and Ship Pollution
Geography - note:
archipelago of 17 inhabited islands and one uninhabited island, and a few uninhabited islets; strategically located along important sea lanes in northeastern Atlantic; precipitous terrain limits habitation to small coastal lowlands

People & Society

Population:
50,730 (July 2017 est.)
country comparison to the world: 211
Nationality:
noun: Faroese (singular and plural)
adjective: Faroese
Ethnic groups:
Faroese 89.2% (Scandinavian and Anglo-Saxon descent), Danish 7.1%, other 3.7% (includes Icelander, Norwegian, Greenlander, Filipino, Thai, British)
note: data represent respondents by country of birth (2011 est.)
Languages:
Faroese 93.8% (derived from Old Norse), Danish 3.2%, other 3% (2011 est.)
Religions:
Christian 89.3% (predominantly Evangelical Lutheran), other 0.7%, more than one religion 0.2%, none 3.8%, unspecified 6% (2011 est.)
Age structure:
0-14 years: 19.89% (male 5,214/female 4,878)
15-24 years: 14.34% (male 3,738/female 3,538)
25-54 years: 37.31% (male 10,252/female 8,676)
55-64 years: 11.69% (male 3,054/female 2,878)
65 years and over: 16.76% (male 4,111/female 4,391) (2017 est.)
population pyramid:
Median age:
total: 37.6 years
male: 37.1 years
female: 38.3 years (2017 est.)
country comparison to the world: 64
Population growth rate:
0.55% (2017 est.)
country comparison to the world: 151
Birth rate:
14.3 births/1,000 population (2017 est.)
country comparison to the world: 134
Death rate:
8.8 deaths/1,000 population (2017 est.)
country comparison to the world: 68
Net migration rate:
0 migrant(s)/1,000 population (2017 est.)
country comparison to the world: 81
Population distribution:
the island of Streymoy is by far the most populous with over 40% of the population; it has approximately twice as many inhabitants as Eysturoy, the second most populous island; seven of the inhabited islands have fewer than 100 people
Urbanization:
urban population: 42.4% of total population (2017)
rate of urbanization: 0.87% annual rate of change (2015-20 est.)
Major urban areas - population:
TORSHAVN (capital) 21,000 (2014)
Sex ratio:
at birth: 1.07 male(s)/female
0-14 years: 1.07 male(s)/female
15-24 years: 1.05 male(s)/female
25-54 years: 1.18 male(s)/female
55-64 years: 1.06 male(s)/female
65 years and over: 0.94 male(s)/female
total population: 1.08 male(s)/female (2016 est.)
Infant mortality rate:
total: 5.4 deaths/1,000 live births
male: 5.7 deaths/1,000 live births
female: 5.1 deaths/1,000 live births (2017 est.)
country comparison to the world: 173
Life expectancy at birth:
total population: 80.5 years
male: 78 years
female: 83.2 years (2017 est.)
country comparison to the world: 38
Total fertility rate:
2.35 children born/woman (2017 est.)
country comparison to the world: 86
Physicians density:
2.63 physicians/1,000 population (2014)
Hospital bed density:
5.14 beds/1,000 population (2014)
HIV/AIDS - adult prevalence rate:
NA
HIV/AIDS - people living with HIV/AIDS:
NA
HIV/AIDS - deaths:
NA

Government

Country name:
conventional long form: none
conventional short form: Faroe Islands
local long form: none
local short form: Foroyar
etymology: the archipelago's name may derive from the Old Norse word "faer," meaning sheep
Dependency status:
part of the Kingdom of Denmark; self-governing overseas administrative division of Denmark since 1948
Government type:
parliamentary democracy (Faroese Parliament); part of the Kingdom of Denmark
Capital:
name: Torshavn
geographic coordinates: 62 00 N, 6 46 W
time difference: UTC 0 (5 hours ahead of Washington, DC, during Standard Time)
daylight saving time: +1hr, begins last Sunday in March; ends last Sunday in October
Administrative divisions:
none (part of the Kingdom of Denmark; self-governing overseas administrative division of Denmark); there are no first-order administrative divisions as defined by the US Government, but there are 30 municipalities
Independence:
none (part of the Kingdom of Denmark; self-governing overseas administrative division of Denmark)
National holiday:
Olaifest (Olavsoka) (commemorates the death in battle of King Olaf II of Norway, later St. Olaf), 29 July (1030)
Constitution:
history: 5 June 1953 (Danish Constitution), 23 March 1948 (Home Rule Act), and 24 June 2005 (Takeover Act) serve as the Faroe Islands constitutional position in the Unity of the Realm
amendments: see entry for Denmark (2016)
Legal system:
the laws of Denmark, where applicable, apply
Citizenship:
see Denmark
Suffrage:
18 years of age; universal
Executive branch:
chief of state: Queen MARGRETHE II of Denmark (since 14 January 1972), represented by High Commissioner Dan Michael KNUDSEN, chief administrative officer (since 1 January 2008)
head of government: Prime Minister Aksel V. JOHANNESEN (since 15 September 2015)
cabinet: Landsstyri appointed by the prime minister
elections/appointments: the monarchy is hereditary; high commissioner appointed by the monarch; following legislative elections, the leader of the majority party or majority coalition usually elected prime minister by the Faroese Parliament; election last held on 1 September 2015 (next to be held in 2019)
election results: Aksel V. JOHANNESEN elected prime minister; Parliament vote - NA
Legislative branch:
description: unicameral Faroese Parliament or Logting (33 seats; members directly elected in a single nationwide constituency by proportional representation vote; members serve 4-year terms)
elections: last held on 1 September 2015 (next to be held no later than October 2019)
election results: percent of vote by party - JF 25.1%, Republic 20.7%, People's Party, 18.9%, Union Party 18.7%, Progressive Party 7%, Center Party 5.5%, Self-Government Party 4.1%; seats by party - JF 8, Republic 7, People's Party 6, Union Party 6, Center Party 2, Progressive Party 2, Self-Government Party 2
note: election for 2 seats in the Danish Parliament was last held on 18 June 2015 (next to be held no later than June 2019); percent of vote by party - NA; seats by party - Social Democratic Party 1, Republican Party 1
Judicial branch:
highest court(s): Faroese Court or Raett (Rett - Danish) decides both civil and criminal cases; the Court is part of the Danish legal system
subordinate courts: Court of the First Instance or Tribunal de Premiere Instance; Court of Administrative Law or Tribunal Administratif; Mixed Commercial Court; Land Court
Political parties and leaders:
Center Party (Midflokkurin) [Jenis av RANA]
New Self-Government Party (Nytt Sjalvstyri) [Jogvan SKORHEIM] (formerly Self-Govenment Party) (Sjalvstyrisflokkurin)
People's Party (Folkaflokkurin) [Jorgen NICLASEN]
Progressive Party (Framsokn) [Poul MICHELSEN]
Republic (Tjodveldi) [Hogni HOYDAL] (formerly the Republican Party)
Social Democratic Party (Javnadarflokkurin) or JF [Aksel V. JOHANNESEN]
Union Party (Sambandsflokkurin) [Bardur a STEIG NIELSEN]
Political pressure groups and leaders:
conservationists
International organization participation:
Arctic Council, IMO (associate), NC, NIB, UNESCO (associate), UPU
Diplomatic representation in the US:
none (self-governing overseas administrative division of Denmark)
Diplomatic representation from the US:
none (self-governing overseas administrative division of Denmark)
Flag description:
white with a red cross outlined in blue extending to the edges of the flag; the vertical part of the cross is shifted toward the hoist side in the style of the Dannebrog (Danish flag); referred to as Merkid, meaning "the banner" or "the mark," the flag resembles those of neighboring Iceland and Norway, and uses the same three colors - but in a different sequence; white represents the clear Faroese sky as well as the foam of the waves; red and blue are traditional Faroese colors
note: the blue on the flag is a lighter blue (azure) than that found on the flags of Iceland or Norway
National symbol(s):
ram; national colors: red, white, blue
National anthem:
name: "Mitt alfagra land" (My Fairest Land)
lyrics/music: Simun av SKAROI/Peter ALBERG
note: adopted 1948; the anthem is also known as "Tu alfagra land mitt" (Thou Fairest Land of Mine); as a self-governing overseas administrative division of Denmark, the Faroe Islands are permitted their own national anthem

Economy

Economy - overview:
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. 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 overheating 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.)
country comparison to the world: 197
GDP (official exchange rate):
$2.765 billion (2010 est.)
GDP - real growth rate:
5.9% (2014 est.)
7.5% (2013 est.)
2.4% (2013 est.)
country comparison to the world: 27
GDP - per capita (PPP):
$40,000 (2014 est.)
country comparison to the world: 43
Gross national saving:
25.7% of GDP (2012 est.)
25.2% of GDP (2011 est.)
25.9% of GDP (2010 est.)
country comparison to the world: 48
GDP - composition, by sector of origin:
agriculture: 18%
industry: 39%
services: 43% (2013 est.)
Agriculture - products:
milk, potatoes, vegetables, sheep, salmon, herring, mackerel and other fish
Industries:
fishing, fish processing, tourism, small ship repair and refurbishment, handicrafts
Industrial production growth rate:
3.4% (2009 est.)
country comparison to the world: 70
Labor force:
28,900 (2015 est.)
country comparison to the world: 206
Labor force - by occupation:
agriculture: 15%
industry: 15%
services: 70% (December 2016 est)
Unemployment rate:
2.8% (2016 est.)
2.9% (2015 est.)
country comparison to the world: 28
Population below poverty line:
4.2% (2012 est.)
Household income or consumption by percentage share:
lowest 10%: NA%
highest 10%: NA%
Distribution of family income - Gini index:
22.7 (2013 est.)
21.6 (2011 est.)
country comparison to the world: 149
Budget:
revenues: $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 revenues:
30.2% of GDP (2014 est.)
country comparison to the world: 79
Budget surplus (+) or deficit (-):
-1.7% of GDP (2014 est.)
country comparison to the world: 79
Public debt:
35% of GDP (2014 est.)
country comparison to the world: 145
Fiscal year:
calendar year
Inflation rate (consumer prices):
-0.3% (2016)
-1.7% (2015)
country comparison to the world: 36
Exports:
$1.184 billion (2016 est.)
$1.019 billion (2015 est.)
country comparison to the world: 154
Exports - commodities:
fish and fish products (97%) (2017 est.)
Exports - partners:
UK 17.8%, Russia 17.3%, Germany 9.8%, China 9.2%, Denmark 6.5%, US 6%, Spain 4.8%, Poland 4.3% (2016)
Imports:
$978.4 million (2016 est.)
$906.1 million (2015 est.)
country comparison to the world: 181
Imports - commodities:
goods for household consumption, machinery and transport equipment, fuels, raw materials and semi-manufactures, cars
Imports - partners:
Denmark 26.6%, Germany 10.7%, China 10.6%, Norway 10.2%, Poland 6.2%, Ireland 5%, Chile 4.2% (2016)
Debt - external:
$387.6 million (2012)
$274.5 million (2010)
country comparison to the world: 183
Exchange rates:
Danish kroner (DKK) per US dollar -
6.7309 (2016)
6.7269 (2015)
6.7236 (2014 est.)
5.6125 (2013 est.)
5.79 (2012 est.)

Energy

Electricity access:
electrification - total population: 100% (2016)
Electricity - production:
317.4 million kWh (2016 est.)
country comparison to the world: 179
Electricity - consumption:
291.4 million kWh (2016 est.)
country comparison to the world: 185
Electricity - exports:
0 kWh (2016 est.)
country comparison to the world: 137
Electricity - imports:
0 kWh (2016 est.)
country comparison to the world: 151
Electricity - installed generating capacity:
128,000 kW (2015 est.)
country comparison to the world: 175
Electricity - from fossil fuels:
50.1% of total installed capacity (2016 est.)
country comparison to the world: 151
Electricity - from nuclear fuels:
0% of total installed capacity (2016 est.)
country comparison to the world: 92
Electricity - from hydroelectric plants:
33.5% of total installed capacity (2016 est.)
country comparison to the world: 62
Electricity - from other renewable sources:
16.4% of total installed capacity (2016 est.)
country comparison to the world: 41
Crude oil - production:
0 bbl/day (2016 est.)
country comparison to the world: 138
Crude oil - exports:
0 bbl/day (2014 est.)
country comparison to the world: 125
Crude oil - imports:
0 bbl/day (2014 est.)
country comparison to the world: 129
Crude oil - proved reserves:
0 bbl (1 January 2017 es)
country comparison to the world: 137
Refined petroleum products - production:
0 bbl/day (2016 est.)
country comparison to the world: 145
Refined petroleum products - consumption:
3,947 bbl/day (2015 est.)
country comparison to the world: 180
Refined petroleum products - exports:
0 bbl/day (2015 est.)
country comparison to the world: 157
Refined petroleum products - imports:
3,947 bbl/day (2016 est.)
country comparison to the world: 171
Natural gas - production:
0 cu m (2016 est.)
country comparison to the world: 137
Natural gas - consumption:
0 cu m (2013 est.)
country comparison to the world: 182
Natural gas - exports:
0 cu m (2016 est.)
country comparison to the world: 105
Natural gas - imports:
0 cu m (2013 est.)
country comparison to the world: 126
Natural gas - proved reserves:
0 cu m (1 January 2014 es)
country comparison to the world: 141
Carbon dioxide emissions from consumption of energy:
800,000 Mt (2013 est.)
country comparison to the world: 170

Communications

Telephones - fixed lines:
total subscriptions: 23,139
subscriptions per 100 inhabitants: 46 (July 2016 est.)
country comparison to the world: 189
Telephones - mobile cellular:
total: 54,487
subscriptions per 100 inhabitants: 108 (July 2016 est.)
country comparison to the world: 199
Telephone system:
general assessment: good international communications; good domestic facilities
domestic: conversion to digital system completed in 1998; both NMT (analog) and GSM (digital) mobile telephone systems are installed
international: country code - 298; satellite earth stations - 1 Orion; 1 fiber-optic submarine cable to the Shetland Islands, linking the Faroe Islands with Denmark and Iceland; fiber-optic submarine cable connection to Canada-Europe cable (2015)
Broadcast media:
1 publicly owned TV station; the Faroese telecommunications company distributes local and international channels through its digital terrestrial network; publicly owned radio station supplemented by 3 privately owned stations broadcasting over multiple frequencies (2015)
Internet country code:
.fo
Internet users:
total: 47,988
percent of population: 95.1% (July 2016 est.)
country comparison to the world: 188

Transportation

National air transport system:
number of registered air carriers: 1 (registered in Denmark)
inventory of registered aircraft operated by air carriers: 3 (registered in Denmark) (2015)
Civil aircraft registration country code prefix:
OY-H (2016)
Airports:
1 (2013)
country comparison to the world: 217
Airports - with paved runways:
total: 1
1,524 to 2,437 m: 1 (2017)
Roadways:
total: 960 km
note: those islands not commected by roads (bridges or tunnels) are connected by seven different ferry links operated by the nationally owned company SSL (2017)
country comparison to the world: 187
Merchant marine:
total: 37
by type: cargo 20, chemical tanker 7, container 2, passenger/cargo 3, refrigerated cargo 3, roll on/roll off 2
foreign-owned: 28 (Iceland 4, Norway 13, Sweden 11) (2010)
country comparison to the world: 80
Ports and terminals:
major seaport(s): Fuglafjordur, Torshavn, Vagur

Military & Security

Military branches:
no regular military forces or conscription; the Government of Denmark has responsibility for defense; as such, the Danish military’s Joint Arctic Command in Nuuk, Greenland is responsible for territorial defense of the Faroe Islands; the Joint Arctic Command has a contact element in the capital of Torshavn (2017)
Military - note:
defense is the responsibility of Denmark

Transnational Issues

Disputes - international:
because anticipated offshore hydrocarbon resources have not been realized, earlier Faroese proposals for full independence have been deferred; Iceland, the UK, and Ireland dispute Denmark's claim to UNCLOS that the Faroe Islands' continental shelf extends beyond 200 nm

Economic Indicators for Faroe Islands including actual values, historical data, and latest data updates for the Faroe Islands economy.