From the poor house to a welfare state

For a long time Iceland belonged to the poorest countries in Europe. Only in the 20th century this changed completely - it switched from an underdeveloped agricultural country to a modern welfare society. Even though only a very small part of the country could be used for agricultural purposes, 100 years ago 50% of the population lived on farms on the coast lines. Nowadays this number droped to under 10%, where most farmers do sheep farming. (By the way: the blue in the flag symbolises the water, the white the ice and glaciers and the red the fire and magma)

After the WW II the prior political aim was to boost the economy and ameliorate the living standarts of the population. The largest investments flowed into the fishing industry and the fish processing companies. Soon the country owned one of the biggest and most modern fishing fleets in the world. Nevertheless the number of people working in this sector dropped gradually but at times 90% of the exports were covered from this part of the economy. The main fishes being caught are cod, herring, redfish, haddock and halibut. With the incomes of the fishing industry Iceland finances the major part of its import of raw materials, food, fuel and engines.

Since the mid 90's Iceland's economy is stable. Today its per-capita income is one of the highest in the world. The problem is that Iceland, except for fish, energy and few agricultural goods, has to costly import most goods. Tourism is meanwhile the second largest income sector. The standart of living is comparable to the other scandinavian countries and is one of the highest in the world. A factor that shouldn't be underestimated for the high quality of living is surely the intact nature.