Iceland

June 17 is the national holiday of Iceland – the National Day of Iceland or Icelandic Republic Day, the Constitution Day and, to put it simply, “þjóðhátíðardagurinn” – the day of the nation’s celebration in Icelandic. On this day, all Icelanders used to gather together and celebrate, as there are less than 320 thous. of them, and even though Iceland, due to its large area, is the most sparsely populated country of Europe – just 3 people per 1 sq. km, the two thirds of its population live in the capital city of Reykjavik. This time, one more ground for celebration has arisen – the crisis, which had hit Iceland the most badly among all European countries, has faded away.

With this article, we continue a series of more detailed reports about each of the four countries of the European Free Trade Association (EFTA), with which Ukraine has recently started the negotiations towards a free trade agreement. Read “Iceland” in our IN DEPTH section.

General overview

“The land of ice,” as the country’s name suggests, is indeed two-thirds arctic desert, but the air temperature rarely drops down below zero of Celsius due to the warm current of Gulfstream. Also, there are a lot of volcanoes, geothermal springs and waterfalls in Iceland. Hydraulic and geothermal energy provide 90 per cent of energy needs of Icelanders.

For descendants of Vikings, the country’s severe climate is not an obstacle to live and work. Iceland belongs to the top ten countries in the world by GDP per capita. Also, it is the third country in Europe by the birth rate (following Albania and France).

Foreign trade

Probably big and rich countries have a choice, but small and poor ones have the only chance to survive – to trade. And this is what Iceland does, and it trades not only in fish and sea products, the share of which has been steadily falling – from 82 per cent in the export of goods back in 1991 down to 41 per cent in 2007, but also in industrial goods and increasingly more – in services, which account for one third of country’s export proceeds. The largest article of the merchandise export, after fish and sea products, almost one third, are aluminum and ferrosilicon.

Iceland is a very “peaceful” member country of the WTO, as it has not been a complainant or defendant in a single trade dispute, and has been registered just as a third party in three cases on deep-sea scallops, in two cases on mutton and one case on salmon fishes.

Iceland and the European Union

Iceland , as opposed to Norway, has never submitted any applications for the EU membership, developing the relations with it within the framework of the European Free Trade Association and European Economic Area. At the same time, this year, as a result of the cruel blow, which the country suffered because of the world economic crisis, talks as to possible accession of Iceland to the EU. The European Union promises a fast and trouble-free process of the accession. Icelanders think over it.

Iceland and Ukraine

Dry figures reflect the dramatic development of the trade relations between our two countries. Whereas in 2007 the export of Ukraine to Iceland increased 10-fold, in 2008 it declined almost by 100 times (!), and in the 1st quarter of 2009 it disappeared at all. The import – in the main, fish – in the 1st quarter of 2009 was equal to two thirds of that in the previous year.

It is interesting that…

All Icelanders call each other by first names. Instead of a surname, a patronymic or, in some cases, matronymic name is added, which in addition to a father’s or mother’s name includes the words ‘son’ or ‘daughter’; this is why a son and daughter of the same father have different patronymic names. Women never change names after getting married, therefore in a family that consists of a father, mother, son and daughter all the four people are called differently. Therefore “the second name” of Icelanders – a patronymic – is never used without the first one.