Background: Settled by Norwegian and Celtic (Scottish and Irish) immigrants during the late 9th and 10th centuries A.D. Iceland boasts the world's oldest functioning legislative assembly the Althing established in 930. Independent for over 300 years Iceland was subsequently ruled by Norway and Denmark. Fallout from the Askja volcano of 1875 devastated the Icelandic economy and caused widespread famine. Over the next quarter century 20% of the island's population emigrated mostly to Canada and the US. Limited home rule from Denmark was granted in 1874 and complete independence attained in 1944. Literacy longevity income and social cohesion are first-rate by world standards.

Geographic coordinates: 65 00 N 18 00 W

Map reference: Arctic Region

Area
Total: 103,000 km²
Land: 100,250 km²
Water: 2,750 km²
Comparative: slightly smaller than Kentucky

Land boundaries: 0 km

Coastline: 4,988 km

Maritime claims
Territorial sea: 12 nm
Exclusive economic zone: 200 nm
Continental shelf: 200 nm or to the edge of the continental margin

Climate: temperate; moderated by North Atlantic Current; mild windy winters; damp cool summers

Terrain: mostly plateau interspersed with mountain peaks icefields; coast deeply indented by bays and fiords

Elevation
Extremes lowest point: Atlantic Ocean 0 m
Extremes highest point: Hvannadalshnukur 2,119 m (at Vatnajokull glacier)

Natural resources: fish hydropower geothermal power diatomite

Land use
Arable land: 0.07%
Permanent crops: 0%
Other: 99.93% (2001)

Irrigated land: NA km²

Natural hazards: earthquakes and volcanic activity

Geography
Note: strategic location between Greenland and Europe; westernmost European country; Reykjavik is the northernmost national capital in the world; more land covered by glaciers than in all of continental Europe

Population: 293,966 (July 2004 est.)
Growth rate: 0.97% (2004 est.)
Below poverty line: NA

Nationality
Noun: Icelander
Adjective: Icelandic

Ethnic groups: homogeneous mixture of descendants of Norse and Celts 94% population of foreign origin 6%

Languages: Icelandic English Nordic languages German widely spoken

Religions: Evangelical Lutheran 87.1% other Protestant 4.1% Roman Catholic 1.7% other 7.1% (2002)

Age structure
0-14 years: 22.5% (male 33,522; female 32,489)
15-64 years: 65.8% (male 98,091; female 95,450)
65 years and over: 11.7% (male 15,552; female 18,862) (2004 est.)

Median age
Total: 33.8 years
Male: 33.3 years
Female: 34.3 years (2004 est.)

Population growth rate: 0.97% (2004 est.)

Birth rate: 13.83 births/1000 population (2004 est.)

Death rate: 6.57 deaths/1000 population (2004 est.)

Net migration rate: 2.38 migrant(s)/1000 population (2004 est.)

Environment
Current issues: water pollution from fertilizer runoff; inadequate wastewater treatment
International agreements party to: Air Pollution, Biodiversity, Climate Change, Climate Change-Kyoto Protocol, Desertification, Endangered Species, Hazardous Wastes, Kyoto Protocol, Law of the Sea, Marine Dumping, Ozone Layer Protection, Ship Pollution, Transboundary Air Pollution, Wetlands
International agreements signed but not ratified: Air Pollution-Persistent Organic Pollutants, Environmental Modification, Marine Life Conservation

Sex ratio
At birth: 1.04 male/female
Under 15 years: 1.03 male/female
15-64 years: 1.03 male/female
65 years and over: 0.83 male/female
Total population: 1 male/female (2004 est.)

Infant mortality rate
Total: 3.31 deaths/1000 live births
Male: 3.44 deaths/1000 live births
Female: 3.17 deaths/1000 live births (2004 est.)

Life expectancy at birth
Total population: 80.18 years
Male: 78.18 years
Female: 82.27 years (2004 est.)

Total fertility rate: 1.93 children born/woman (2004 est.)

Hivaids
Adult prevalence rate: 0.2% (2001 est.)
People living with hivaids: 220 (2001 est.)
Deaths: less than 100 (2003 est.)

Literacy
Definition: age 15 and over can read and write
Total population: 99.9% (1997 est.)
Male: NA
Female: NA

Country name
Conventional long form: Republic of Iceland
Conventional short form: Iceland
Local long form: Lydhveldidh Island
Local short form: Island

Government type: constitutional republic

Capital: Reykjavik

Administrative divisions: 8 regions; Austurland Hofudhborgarsvaedhi Nordhurland Eystra Nordhurland Vestra Sudhurland Sudhurnes Vestfirdhir Vesturland

Independence: 1 December 1918 (became a sovereign state under the Danish Crown); 17 June 1944 (from Denmark)

National holiday: Independence Day 17 June (1944)

Constitution: 16 June 1944 effective 17 June 1944

Legal system: civil law system based on Danish law; has not accepted compulsory ICJ jurisdiction

Suffrage: 18 years of age; universal

Executive branch
Chief of state: President Olafur Ragnar GRIMSSON (since 1 August 1996)
Head of government: Prime Minister Halldor ASGRIMSSON (since 15 September 2004); note - Former Prime Minister David ODDSSON switched positions with former Foreign Minister Halldor ASGRIMMSON
Cabinet: Cabinet appointed by the prime minister and approved by Parliament
Elections: president, which is largely a ceremonial post, elected by popular vote for a four-year term; election last held 26 June 2004 (next to be held June 2008); prime minister appointed by the president
Election results: Olafur Ragnar GRIMSSON wins with 85.6% of the vote, Baldur AGUSTSSON 12.5%, Astthor MAGNUSSON 1.9%

Legislative branch
Elections: last held 10 May 2003 (next to be held by May 2007)
Election results: percent of vote by party - Independence Party 33.7%, Social Democratic Alliance 31.0%, Progressive Party 17.7%, Left-Green Alliance 8.8%, Liberal Party 7.4%; seats by party - Independence Party 22, Social Democratic Alliance 20, Progressive Party 12, Left-Green Alliance 5, Liberal Party 4

Judicial branch: Supreme Court or Haestirettur (justices are appointed for life by the Minister of Justice); eight district courts (justices are appointed for life by the Minister of Justice)

Political parties and leaders: Independence Party or IP [David ODDSSON]; Left-Green Alliance or LGP [Steingrimur SIGFUSSON]; Liberal Party or LP [Gudjon KRISTJANSSON]; Progressive Party or PP [Halldor ASGRIMSSON]; Social Democratic Alliance (includes People's Alliance or PA Social Democratic Party or SDP Women's List) or SDA [Ossur SKARPHEDINSSON]

International organization participation: Australia Group BIS CBSS CE EAPC EBRD EFTA FAO IAEA IBRD ICAO ICC ICCt ICFTU ICRM IDA IFAD IFC IFRCS IHO ILO IMF IMO Interpol IOC ISO ITU MIGA NATO NC NEA NIB OECD OPCW OSCE PCA UN UNCTAD UNESCO UPU WCO WEU (associate) WHO WIPO WMO WTO

Diplomatic representation
In the us chief of mission: Ambassador Helgi AGUSTSSON
In the us chancery: Suite 1200, 1156 15th Street NW, Washington, DC 20,005-1704
In the us telephone: [1] (202) 265-6,653
In the us fax: [1] (202) 265-6,656
In the us consulates general: New York
From the us chief of mission: Ambassador James I. GADSDEN
From the us embassy: Laufasvegur 21, 101 Reykjavik
From the us mailing address: US Embassy, PSC 1003, Box 40, FPO AE 9,728-0340
From the us telephone: [354] 562-9,100
From the us fax: [354] 562-9,118

Flag description: blue with a red cross outlined in white extending to the edges of the flag; the vertical part of the cross is shifted to the hoist side in the style of the Dannebrog (Danish flag)

Economy overview: Iceland's Scandinavian-type economy is basically capitalistic yet with an extensive welfare system (including generous housing subsidies) low unemployment and remarkably even distribution of income. In the absence of other natural resources (except for abundant geothermal power) the economy depends heavily on the fishing industry which provides 70% of export earnings and employs 12% of the work force. The economy remains sensitive to declining fish stocks as well as to fluctuations in world prices for its main exports: fish and fish products aluminum and ferrosilicon. Government policies include reducing the budget and current account deficits limiting foreign borrowing containing inflation revising agricultural and fishing policies diversifying the economy and privatizing state-owned industries. The government remains opposed to EU membership primarily because of Icelanders' concern about losing control over their fishing resources. Iceland's economy has been diversifying into manufacturing and service industries in the last decade and new developments in software production biotechnology and financial services are taking place. The tourism sector is also expanding with the recent trends in ecotourism and whale watching. Growth had been remarkably steady in 1996-2001 at 3%-5% but could not be sustained in 2002 in an environment of global recession. Growth resumed in 2003 and inflation dropped back from 5% to 2%.

Real gdp growth rate: 2.6% (2003 est.)

Real gdp per capita: purchasing power parity - $30,900 (2003 est.)

Gdp composition by sector of origin
Agriculture: 9.2% (includes fishing 12%)
Industry: 26.7%
Services: 64.2% (2003 est.)

Agriculture products: potatoes green vegetables mutton dairy products fish

Industries: fish processing; aluminum smelting ferrosilicon production geothermal power; tourism

Industrial production growth rate: 8.1% (2003 est.)

Labor force: 160,000 (2003)
By occupation agriculture: 5.1%
By occupation fishing and fish processing: 11.8%
By occupation manufacturing: 12.9%
By occupation construction: 10.7%
By occupation services: 59.5% (1999)

Unemployment rate: 3.4% (2003 est.)

Population below poverty line: NA

Household income or consumption by percentage share
Lowest 10: NA
Highest 10: NA

Budget
Revenues: $4.205 billion
Expenditures: $4.405 billion, including capital expenditures of $467 million (2003)

Public debt: 41.5% of GDP (2003)

Fiscal year: calendar year

Inflation rate consumer prices: 2.1% (2003 est.)

Current account balance: $-574 million (2003)

Exports: $2.379 billion f.o.b. (2003 est.)
Commodities: fish and fish products 70% animal products aluminum diatomite ferrosilicon
Partners: Germany 17.4% UK 17.4% Netherlands 11.2% US 9.8% Spain 6.3% Denmark 5% Norway 4.5% France 4% (2003)

Imports: $2.59 billion (2003 est.)
Commodities: machinery and equipment petroleum products; foodstuffs textiles
Partners: Germany 11.8% Denmark 8% US 7.5% UK 7.5% Norway 7% Sweden 6.5% Netherlands 6.2% Italy 4.7% (2003)

Debt external: $2.6 billion (1999)

Exchange rates: Icelandic kronur per US dollar - 76.709 (2003) 91.6617 (2002) 97.4246 (2001) 78.6159 (2000) 72.3353 (1999)

Electricity
Production: 7.894 billion kWh (2001)
Consumption: 7.341 billion kWh (2001)
Exports: 0 kWh (2001)
Imports: 0 kWh (2001)

Telephones
Main lines in use: 190,700 (2003)
Mobile cellular: 279,100 (2003)

Telephone system
General assessment: extensive domestic service
Domestic: the trunk network consists of coaxial and fiber-optic cables and microwave radio relay links
International: country code - 354; satellite earth stations - 2 Intelsat (Atlantic Ocean), 1 Inmarsat (Atlantic and Indian Ocean regions); note - Iceland shares the Inmarsat earth station with the other Nordic countries (Denmark, Finland, Norway, and Sweden)

Internet
Country code: .is
Hosts: 122,175 (2004)
Users: 195,000 (2003)

Military expenditures
Dollar figure: 0

Airports: 100 (2003 est.)
With paved runways total: 5
With paved runways over 3047 m: 1
With paved runways 15-24 to 2437 m: 3
With paved runways 914 to 1523 m: 1 (2004 est.)
With unpaved runways total: 93
With unpaved runways 15-24 to 2437 m: 3
With unpaved runways 914 to 1523 m: 29
With unpaved runways under 914 m: 61 (2004 est.)

Merchant marine
Total: 1 ships (1,000 GRT or over) 4,341 GRT/6,019 DWT
By type: petroleum tanker 1
Registered in other countries: 26 (2004 est.)

Disputes international: Rockall continental shelf dispute involving Denmark Iceland and the UK (Ireland and the UK have signed a boundary agreement in the Rockall area) remains dormant; dispute with Denmark over the Faroe Islands' fisheries median line boundary within 200 nm; disputes with Denmark the UK and Ireland over the Faroe Islands continental shelf boundary outside 200 nm