Iceland in the global market

U.N Comtrade Data

Jared Mercadante

Blog Post #2

     Being a small island in the middle of the Atlantic Ocean poses problems for Iceland. With a population of only 331,310, their productivity is very limited. In addition, the island is covered in glaciers, volcanoes, and lava fields, making much of it almost useless, as production is concerned. Because it is an island, a major component of their economy is fishing. Their exports, in dollars, of fish hovers currently at $10,193,719,691. Their other largest export is aluminum. For items found most useful in modern life, such as cars and electronics, they have to import almost everything. As you can see in the graph below, this small Scandinavian island imports most of its useful goods, yet comes out as a net exporter due to its aluminum production and excellent fishing capabilities:

     Iceland gets most of its imports from Norway, the United States, and Germany, who, altogether, make up about 30% of Iceland's total imports, coming in at $8,839,443,999. Iceland exports the majority of its products to the Netherlands, Germany, and United Kingdom. 

     When looking at mirror statistics, for both imports and exports, there is a tendency for countries to be incredibly inconsistent in their reporting. For example, the United States reported exports of about $6 trillion, yet other countries only reported receiving about $3.75 trillion. As far as imports are concerned, Icelandic reports are pretty consistent with those of the countries from which it receives its goods. Their exports are less in line with the reports of other countries. Iceland reported exports of about $4.7 billion to Norway who, in return, only documented imports of $671,000,000. I have trouble believing that this discrepancy comes from poor accounting. There must be other reasons for the massive differences between Icelandic and Norwegian reports. 

     Due to the island's culture, fishing is naturally one of its largest and most lucrative businesses. Iceland's exports of fish in 2013 were about $5 billion dollars. The majority of Iceland's fishing trade is, as it should be expected, with first world countries. Although this is logical, I find it slightly odd. Most first world countries- Germany, Spain, France, England, the United States, etc.- are not land locked, meaning that it seems obvious they would be able to fish for themselves. But, because of Iceland's inability to do much else, it seems that other countries are content to let this small island fish for them which, in turn, allows these larger countries to allocate resources to other areas. Because of its ability to focus on fishing, Iceland has an absolute advantage in that area. 

      Although it is small, Iceland has a rich tradition of economic activity. It is not a world power, yet its specific skill sets (fishing and aluminum production) allow it to survive in today's economy.

Works Cited

•  Statistics Iceland. N.p., n.d. Web. <http://www.statice.is/publications/news-archive/population/population-in-the-3rd-quarter-2015/>.
•  "UN Comtrade Demo | SAS® Visual Analytics." UN Comtrade Demo | SAS® Visual Analytics. N.p., n.d. Web. 13 Dec. 2015.