Economy - overview The Faroese economy in 1995 and 1996 saw a noticeable upturn after severalyears of decline brought on by a drop in fish catches and declining pricesand by over-spending by the Faroese Home Rule Government (FHRG). In the early1990s, property values plummeted, and the FHRG had to bail out and merge thetwo largest Faroese banks. Fishing is now improving; wage costs are increasing;the FHRG's budget is almost in balance; and the large foreign debt has comedown significantly. Nevertheless, the total dependence on fishing makes theFaroese economy extremely vulnerable, and the reduction in the foreign debtis at the cost of low investment. Oil finds close to the Faroese area givehope for deposits in the immediate Faroese area, which may lay the basis foran eventual economic rebound. Aided by a substantial annual subsidy from Denmark,the Faroese have a standard of living comparable to the Danes and other Scandinavians.

GDP purchasing power parity - $800 million (1996 est.)

GDP - real growth rate 6% (1996 est.)

GDP - per capita purchasing power parity - $16,300 (1996 est.)

GDP - composition by sector
agriculture: 20%
industry: 16%
services : 64% (1996 est.)

Inflation rate - consumer price index 2.8% (1996 est.)

Labor force
total: 20,345 (1995 est.)
by occupation: largely engaged in fishing, manufacturing, transportation, and commerce

Unemployment rate 11% (1996 est.)

Budget
revenues : $467 million
expenditures: $468 million, including capital expenditures of $11 million (1996 est.)

Industries fishing, shipbuilding, construction, handicrafts

Industrial production growth rate NA%

Electricity - capacity 91,000 kW 000 kW

Electricity - production 175.4 million kWh

Electricity - consumption per capita 4,043 kWh (1995)

Agriculture - products milk, potatoes, vegetables; sheep; salmon farming; fish

Exports
total value: $362 million (f.o.b., 1995)
commodities : fish and fish products 92%, animal feedstuffs, transport equipment (ships)
partners: Denmark 22.2%, UK 25.8%, Germany 9.7%, France 8.3%, Norway 6.2%, US2.0%

Imports
total value: $315.6 (c.i.f., 1995)
commodities: machinery and transport equipment 17.0%, consumer goods 33%, raw materialsand semi-manufactures 26.9%, fuels 11.4%, fish and salt 6.7%
partners : Denmark 34.5%, Norway 15.9%, UK 8.4% Germany 7.8%, Sweden 5.8%, US 1.5%

Debt - external $767 million (1995 est.)

Economic aid receives an annual subsidy from Denmark of about $150 million (1995)

Currency 1 Danish krone (DKr) = 100 oere

Exchange rates Danish kroner (DKr) per US$1 - 6.117 (January 1997), 5.799 (1966), 5.602(1995), 6.361 (1994), 6.484 (1993), 6.036 (1992)

Fiscal year calendar year

NOTE: The information regarding Faroe Islands on this page is re-published from the 1997 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Faroe Islands Economy 1997 information contained here. All suggestions for corrections of any errors about Faroe Islands Economy 1997 should be addressed to the CIA.