Iceland is one of the wealthiest as well as most developed countries in the world. The United Nations (2011) human development index ranks it as the 14th most developed country in the world. It is also fourth in terms of the most productive country per capita. According to the International Monetary Fund (2012), the 2011 estimate of total nominal GDP of Iceland was $14.048 billion, while the per capita GDP was $43, 088.
The unemployment rate of Iceland is 7.4%. There is also substantial underemployment estimated at 15%. In the past decade, Iceland experienced an immense recession due to failures in its banking system. By September 2012, the inflation rate was 4.3%, which was significantly high when compared to that of the United States, which was 2%. From 1989 to 2012, the country’s average inflation rate was 5.8%. Iceland experienced an unprecedented high inflation rate of 25.2% in 1989 and low of -0.1% in 1994 % (CIA World Fact Book).
Iceland has reported a 12525 million ISK trade surplus as at august 2012. From 1989 to 2012, the country’s average balance of trade was -279.1 million ISK (International Monetary Fund, 2012). Iceland’s economy is largely export-driven. The main exports are fish as well as fish products, aluminum and animal products. It mainly imports machinery, petroleum products, food and textiles. The European Union, the Unites States and Japan are the countries principal trading partners.
The country is a representative democracy and has a parliamentary system. It holds its elections after every four years, which resembles the practice in the United States. However, unlike the United States, the country’s presidency is largely ceremonial. Instead, the country’s Prime Minister enjoys the executive powers together with the cabinet.
Iceland is the most sparsely populated nation in Europe. Besides, it enjoys a life expectancy of 82 years for women and 77 years for men, which is among the highest in the world. A 2006 study ranked the people of Iceland as the fourth happiest in the world (CIA World Fact Book).
Bermuda is an Island that resembles Iceland geographically. Both countries sustain their livelihoods by relying on imports. However, the inflation rate of Bermuda is low (2.7%) when compared with that of Iceland (4.3%). Iceland’s recent economic hardships might explain its relatively high inflation rate. However, Iceland has higher life expectancy when compared to Bermuda.
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