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OECD: Iceland makes more from tourism than fisheries

OECD: Iceland makes more from tourism than fisheries

| Text and photo: Guðrún Helga Sigurðardóttir

Tourism has become Iceland’s largest trade and top source of income representing 8.3 percent of GDP, according to the OECD report “Tourism Trends and Policies 2018. Only in Spain, Portugal and Mexico does tourism make up a greater percentage of GDP. 14 percent of Iceland’s labour force now works in the tourism industry.

Tourism in Iceland has grown by an average of 25 percent in recent years. The growth has led to a surplus in foreign trade, created new companies and thousands of jobs. Tourism is now the country’s largest export. In 2016 it created 39 percent of the total foreign currency income – more than both the fisheries and the aluminium industries combined.

Iceland’s population is only 350,000, but each year some two and a half million tourists visit the island. Most come from the USA, the UK and Germany. The USA, the UK and China are behind most of the growth.

Source: OECD

The OCED’s statistics are from 2016, and since then the number of visiting tourists has risen further. The total number is one fifth of those visiting Denmark and Sweden. Source: OECD

Edward J. Huijbens, Professor at the University of Akureyri, is not surprised. He says the report shows what was expected. Tourism has grown rapidly in Iceland; since 2010 the graph has been pointing sharply upwards. He thinks Iceland actually has not done anything for this to happen.

Unexpected tourists

“It just happened. Suddenly people started streaming in to Iceland. The country has become a tourism country. Everyone must acknowledge that,” he says.

Iceland’s government now face new challenges, according to the OECD report – the main being how to maximise the benefits from tourism while also protecting what the tourism is built on. The rapid growth has put further pressure on nature, infrastructure and society as a whole.

Souirce: OECD

Measured in the percentage of GDP which tourism represents, Iceland beats the other Nordic countries hands down. Source: OECD  

Huijbens says that Iceland has not prepared for the massive stream of people. But as the growth slow somewhat, Iceland has the opportunity to improve tourism infrastructure, carry out some strategic planning, invest and organise, he says.

“We should have done this earlier, but we really have to do it now,” he continues. He thinks Iceland now must make basic decisions on land use, establish more national parks and make other major decisions relevant to Iceland’s needs and interests as a tourism country.

“Should we improve infrastructure in step with Iceland as a tourism country? Or should we hope we get lucky, everything will be OK and that our foreign guests will continue arriving in Iceland?” says Professor Edward J. Huijbens.

Having a whale of a time

Tourists on a whale safari on a fishing boat illustrate how the seas can bring income in different ways. Here a pod of orca are swimming near the Grundafjödur in western Iceland. Photo: Inspired by Iceland.


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