Iceland Tourism

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Iceland is a stable democracy with a dynamic consumer economy based on fishing, tourism, aluminum smelting and information technology. Icelanders are generally well educated, with sophisticated tastes and a liking for American consumer goods. This, along with a per capita GDP of $54,764 (2006 preliminary data) means that the Icelandic lifestyle is similar in many ways to that in the U.S. Almost all Icelanders speak English, and there is no language barrier for Americans doing business. Iceland is one of the most advanced countries in the world in the use of information and telecom technology. Icelandic banks and other financial institutions are fully connected to world markets, and there are no foreign exchange controls or restrictions on movement of capital.

Iceland is an island nation in the North Atlantic Ocean between Greenland and Norway.  It is about the size of the State of Virginia and has a population of 307,672. The first settlers arrived from Norway in 874.  Iceland achieved full independence from Denmark in 1944, having been ruled by the Norwegians and then Danes for almost 700 years.  Iceland is a member of EFTA and the EEA. It is also a member of NATO but has no armed forces of its own.  The U.S., on behalf of NATO, bears primary responsibility for the defense of Iceland under the terms of a 1951 bilateral defense agreement.  The U.S. maintained a Naval Air Station in Iceland until September 2006, when the base was closed and U.S. forces redeployed elsewhere.  The bilateral agreement was modified to reflect the continuing U.S. responsibility for Iceland's defense through flexible and mobile means.  The former base area is currently undergoing redevelopment, with a public corporation established to examine public- and private sector opportunities.

Iceland's economy is highly export-driven. Marine products account for the majority of goods exports. Other important exports include aluminum, ferro-silicon alloys, machinery and electronic equipment for the fishing industry, software, and woolen goods. Most of Iceland's exports go to the EU and EFTA countries, the United States, and Japan. The U.S. is Iceland's largest bilateral investment partner and largest partner in services trade. Potential growth areas for exports to Iceland include electric generating equipment, processed foods, wine and beer, computer equipment and software, franchised businesses, high-tech fishing equipment, aircraft, vehicles, and furniture. The GOI has recently decided to dramatically decrease import tariffs on certain categories of foodstuffs and consumer products, which should open the market for further imports of U.S. goods. The main barriers to U.S. exports are Iceland's increasing adoption of EU product standards and regulations. Most agricultural products are subject to high tariffs and import of some, such as uncooked meat, is greatly restricted for phyto-sanitary reasons.

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Iceland Tourism