overview

Iceland (Icelandic: Ísland) is a Nordic island country in the North Atlantic Ocean and in the Arctic Ocean. Iceland is the most sparsely populated country in Europe.Iceland's capital and largest city is Reykjavík, which is home to about 36% of the population. Iceland is the largest part of the Mid-Atlantic Ridge that rises above sea level, and its central volcanic plateau is erupting almost constantly. The interior consists of a plateau characterised by sand and lava fields, mountains, and glaciers, and many glacial rivers flow to the sea through the lowlands. Iceland is warmed by the Gulf Stream and has a temperate climate, despite a high latitude just outside the Arctic Circle. Its high latitude and marine influence keep summers chilly, and most of its islands have a polar climate.

According to the ancient manuscript Landnámabók, the settlement of Iceland began in 874 AD when the Norwegian chieftain Ingólfr Arnarson became the first permanent settler on the island.[15] In the following centuries, Norwegians, and to a lesser extent other Scandinavians, immigrated to Iceland, bringing with them thralls (i.e., slaves or serfs) of Gaelic origin.

The island was governed as an independent commonwealth under the native parliament, the Althing, one of the world's oldest functioning legislative assemblies. Following a period of civil strife, Iceland acceded to Norwegian rule in the 13th century. The establishment of the Kalmar Union in 1397 united the kingdoms of Norway, Denmark, and Sweden. Iceland thus followed Norway's integration into that union, coming under Danish rule after Sweden seceded from the union in 1523. The Danish kingdom forcefully introduced Lutheranism to Iceland in 1550.

Influenced by ideals of nationalism after the French Revolution, Iceland's struggle for independence took form and culminated in the Danish–Icelandic Act of Union in 1918, with the establishment of the Kingdom of Iceland, sharing through a personal union the incumbent monarch of Denmark. During the occupation of Denmark in World War II, Iceland voted overwhelmingly to become a republic in 1944, thus ending the remaining formal ties with Denmark. Although the Althing was suspended from 1799 to 1845, the island republic has nevertheless been credited with sustaining the world's oldest and longest-running parliament.

Until the 20th century, Iceland relied largely on subsistence fishing and agriculture. Industrialization of the fisheries and Marshall Plan aid following World War II brought prosperity, and Iceland became one of the wealthiest and most developed nations in the world. It became a part of the European Economic Area in 1994; this further diversified the economy into sectors such as finance, biotechnology, and manufacturing.

Iceland has a market economy with relatively low taxes, compared to other OECD countries, as well as the highest trade union membership in the world.It maintains a Nordic social welfare system that provides universal health care and tertiary education for its citizens.Iceland ranks highly in international comparisons of national performance, such as quality of life, education, protection of civil liberties, government transparency, and economic freedom.

Icelandic culture is founded upon the nation's Scandinavian heritage. Most Icelanders are descendants of Norse and Gaelic settlers. Icelandic, a North Germanic language, is descended from Old West Norse and is closely related to Faroese. The country's cultural heritage includes traditional Icelandic cuisine, Icelandic literature, and medieval sagas. Iceland has the smallest population of any NATO member and is the only one with no standing army, with a lightly armed coast guard.

Etemology

The Sagas of Icelanders say that a Norwegian named Naddodd (or Naddador) was the first Norseman to reach Iceland, and in the ninth century, he named it Snæland or "snow land" because it was snowing. Following Naddodd, the Swede Garðar Svavarsson arrived, and so the island was then called Garðarshólmur which means "Garðar's Isle".

Then came a Viking named Flóki Vilgerðarson; his daughter drowned en route, then his livestock starved to death. The sagas say that the rather despondent Flóki climbed a mountain and saw a fjord (Arnarfjörður) full of icebergs, which led him to give the island its new and present name. The notion that Iceland's Viking settlers chose that name to discourage the settlement of their verdant isle is a myth.

history

According to both Landnámabók and Íslendingabók, monks known as the Papar lived in Iceland before Scandinavian settlers arrived, possibly members of a Hiberno-Scottish mission. Recent archaeological excavations have revealed the ruins of a cabin in Hafnir on the Reykjanes peninsula. Carbon dating indicates that it was abandoned sometime between 770 and 880. In 2016, archaeologists uncovered a longhouse in Stöðvarfjörður that has been dated to as early as 800.

Swedish Viking explorer Garðar Svavarsson was the first to circumnavigate Iceland in 870 and establish that it was an island.[25] He stayed during the winter and built a house in Húsavík. Garðar departed the following summer, but one of his men, Náttfari, decided to stay behind with two slaves. Náttfari settled in what is now known as Náttfaravík, and he and his slaves became the first permanent residents of Iceland to be documented.

The Norwegian-Norse chieftain Ingólfr Arnarson built his homestead in present-day Reykjavík in 874. Ingólfr was followed by many other emigrant settlers, largely Scandinavians and their thralls, many of whom were Irish or Scottish. By 930, most arable land on the island had been claimed; the Althing, a legislative and judicial assembly was initiated to regulate the Icelandic Commonwealth. The lack of arable land also served as an impetus to the settlement of Greenland starting in 986. The period of these early settlements coincided with the Medieval Warm Period, when temperatures were similar to those of the early 20th century. At this time about 25% of Iceland was covered with forest, compared to 1% in the present day. Christianity was adopted by consensus around 999–1000, although Norse paganism persisted among segments of the population for some years afterward.

The Middle Ages

Reformation and the Early Modern period

See also: Icelandic Reformation, Danish trade monopoly in Iceland, and MóðuharðindinÓsvör, a replica of an old fishing outpost outside Bolungarvík

Around the middle of the 16th century, as part of the Protestant Reformation, King Christian III of Denmark began to impose Lutheranism on all his subjects. Jón Arason, the last Catholic bishop of Hólar, was beheaded in 1550 along with two of his sons. The country subsequently became officially Lutheran, and Lutheranism has since remained the dominant religion.

A map of Iceland published in the early 17th century by Gerardus Mercator

In the 17th and 18th centuries, Denmark imposed harsh trade restrictions on Iceland. Natural disasters, including volcanic eruptions and disease, contributed to a decreasing population. In the summer of 1627, Barbary Pirates committed the events known locally as the Turkish Abductions, in which hundreds of residents were taken into slavery in North Africa and dozens killed; this was the only invasion in Icelandic history to have casualties.The 1707–08 Iceland smallpox epidemic is estimated to have killed a quarter to a third of the population.In 1783 the Laki volcano erupted, with devastating effects.In the years following the eruption, known as the Mist Hardships (Icelandic: Móðuharðindin), over half of all livestock in the country died. Around a quarter of the population starved to death in the ensuing famine.

1814–1918: Independence movement

See also: Icelandic independence movement and Fjölnir (journal)

In 1814, following the Napoleonic Wars, Denmark-Norway was broken up into two separate kingdoms via the Treaty of Kiel but Iceland remained a Danish dependency. Throughout the 19th century, the country's climate continued to grow colder, resulting in mass emigration to the New World, particularly to the region of Gimli, Manitoba in Canada, which was sometimes referred to as New Iceland. About 15,000 people emigrated, out of a total population of 70,000.[42]

A national consciousness arose in the first half of the 19th century, inspired by romantic and nationalist ideas from mainland Europe. An Icelandic independence movement took shape in the 1850s under the leadership of Jón Sigurðsson, based on the burgeoning Icelandic nationalism inspired by the Fjölnismenn and other Danish-educated Icelandic intellectuals. In 1874, Denmark granted Iceland a constitution and limited home rule. This was expanded in 1904, and Hannes Hafstein served as the first Minister for Iceland in the Danish cabinet.

1918–1944: Independence and the Kingdom of Iceland

See also: Kingdom of Iceland, Invasion of Iceland, and Iceland in World War IIHMS Berwick led the British invasion of Iceland.

The Danish–Icelandic Act of Union, an agreement with Denmark signed on 1 December 1918 and valid for 25 years, recognised Iceland as a fully sovereign and independent state in a personal union with Denmark. The Government of Iceland established an embassy in Copenhagen and requested that Denmark carry out on its behalf certain defence and foreign affairs matters, subject to consultation with the Althing. Danish embassies around the world displayed two coats of arms and two flags: those of the Kingdom of Denmark and those of the Kingdom of Iceland. Iceland's legal position became comparable to those of countries belonging to the Commonwealth of Nations, such as Canada, whose sovereign is King Charles III.

During World War II, Iceland joined Denmark in asserting neutrality. After the German occupation of Denmark on 9 April 1940, the Althing replaced the King with a regent and declared that the Icelandic government would take control of its own defence and foreign affairs. A month later, British armed forces conducted Operation Fork, the invasion and occupation of the country, violating Icelandic neutrality. In 1941, the Government of Iceland, friendly to Britain, invited the then-neutral United States to take over its defence so that Britain could use its troops elsewhere.

1944–present: Republic of Iceland

See also: Icelandic constitutional referendum, 1944; Iceland in the Cold War; and Cod WarsBritish warship HMS Scylla (right) collides with Icelandic cost guard vessel ICGV Óðinn in the Atlantic Ocean during the Third Cod War

On 31 December 1943, the Danish–Icelandic Act of Union expired after 25 years. Beginning on 20 May 1944, Icelanders voted in a four-day plebiscite on whether to terminate the personal union with Denmark, abolish the monarchy, and establish a republic. The vote was 97% to end the union, and 95% in favour of the new republican constitution. Iceland formally became a republic on 17 June 1944, with Sveinn Björnsson as its first president.

In 1946, the US Defence Force Allied left Iceland. The nation formally became a member of NATO on 30 March 1949, amid domestic controversy and riots. On 5 May 1951, a defence agreement was signed with the United States. American troops returned to Iceland as the Iceland Defence Force and remained throughout the Cold War. The US withdrew the last of its forces on 30 September 2006.

Iceland prospered during the Second World War. The immediate post-war period was followed by substantial economic growth, driven by the industrialisation of the fishing industry and the US Marshall Plan programme, through which Icelanders received the most aid per capita of any European country (at US$209, with the war-ravaged Netherlands a distant second at US$109).

Vigdís Finnbogadóttir assumed Iceland's presidency on 1 August 1980, making her the first elected female head of state in the world.

The 1970s were marked by the Cod Wars—several disputes with the United Kingdom over Iceland's extension of its fishing limits to 200 nmi (370 km) offshore. Iceland hosted a summit in Reykjavík in 1986 between United States President Ronald Reagan and Soviet Premier Mikhail Gorbachev, during which they took significant steps towards nuclear disarmament. A few years later, Iceland became the first country to recognise the independence of Estonia, Latvia, and Lithuania as they broke away from the USSR. Throughout the 1990s, the country expanded its international role and developed a foreign policy orientated towards humanitarian and peacekeeping causes. To that end, Iceland provided aid and expertise to various NATO-led interventions in Bosnia, Kosovo, and Iraq.

Iceland joined the European Economic Area in 1994, after which the economy was greatly diversified and liberalised. International economic relations increased further after 2001 when Iceland's newly deregulated banks began to raise great amounts of external debt, contributing to a 32 percent increase in Iceland's gross national income between 2002 and 2007.

Economic boom and crisis

Further information: 2008–2011 Icelandic financial crisis and 2009 Icelandic financial crisis protests

In 2003–2007, following the privatisation of the banking sector under the government of Davíð Oddsson, Iceland moved towards having an economy based on international investment banking and financial services.It was quickly becoming one of the most prosperous countries in the world, but was hit hard by a major financial crisis.The crisis resulted in the greatest migration from Iceland since 1887, with a net emigration of 5,000 people in 2009.

Since 2012

Iceland's economy stabilised under the government of Jóhanna Sigurðardóttir and grew by 1.6% in 2012. The centre-right Independence Party was returned to power in coalition with the Progressive Party in the 2013 election. In the following years, Iceland saw a surge in tourism as the country became a popular holiday destination. In 2016, Prime Minister Sigmundur Davíð Gunnlaugsson resigned after being implicated in the Panama Papers scandal.Early elections in 2016 resulted in a right-wing coalition government of the Independence Party, the Reform Party and Bright Future. This government fell when Bright Future quit the coalition due to a scandal involving then-Prime Minister Bjarni Benediktsson's father's letter of support for a convicted child offender. Snap elections in October 2017 brought to power a new coalition consisting of the Independence Party, the Progressive Party, and the Left-Green Movement, headed by Katrín Jakobsdóttir.

After the 2021 parliamentary election, the new government was, just like the previous government, a tri-party coalition of the Independence Party, the Progressive Party, and the Left-Green Movement, headed by Prime Minister Katrín Jakobsdóttir.

geography

Iceland is at the juncture of the North Atlantic and Arctic Oceans. The main island is entirely south of the Arctic Circle, which passes through the small Icelandic island of Grímsey off the main island's northern coast. The country lies between latitudes 63 and 68°N, and longitudes 25 and 13°W.

Iceland is closer to continental Europe than to mainland North America, although it is closest to Greenland (290 kilometres; 155 nautical miles), an island of North America. Iceland is generally included in Europe for geographical, historical, political, cultural, linguistic and practical reasons.[61][62][63][64] Geologically, the island includes parts of both continental plates. The closest bodies of land in Europe are the Faroe Islands (420 km; 225 nmi); Jan Mayen Island (570 km; 310 nmi); Shetland and the Outer Hebrides, both about 740 km (400 nmi); and the Scottish mainland and Orkney, both about 750 km (405 nmi). The nearest part of Continental Europe is mainland Norway, about 970 km (525 nmi) away, while mainland North America is 2,070 km (1,120 nmi) away, at the northern tip of Labrador.

Three typical Icelandic landscapes

Iceland is the world's 18th-largest island, and Europe's second-largest island after Great Britain and before Ireland. The main island covers 101,826 km2 (39,315 sq mi), but the entire country is 103,000 km2 (40,000 sq mi) in size, of which 62.7% is tundra. Iceland contains about 30 minor islands, including the lightly populated Grímsey and the Vestmannaeyjar archipelago. Lakes and glaciers cover 14.3% of its surface; only 23% is vegetated. The largest lakes are Þórisvatn reservoir: 83–88 km2 (32–34 sq mi) and Þingvallavatn: 82 km2 (32 sq mi); other important lakes include Lagarfljót and Mývatn. Jökulsárlón is the deepest lake, at 248 m (814 ft).

Geologically, Iceland is part of the Mid-Atlantic Ridge, a ridge along which the oceanic crust spreads and forms new crust. This part of the mid-ocean ridge is located above a mantle plume, causing Iceland to be subaerial (above the surface of the sea). The ridge marks the boundary between the Eurasian and North American Plates, and Iceland was created by rifting and accretion through volcanism along the ridge.

Many fjords punctuate Iceland's 4,970-km-long (3,088-mi) coastline, which is also where most settlements are situated. The island's interior, the Highlands of Iceland, is a cold and uninhabitable combination of sand, mountains, and lava fields. The major towns are the capital city of Reykjavík, along with its outlying towns of Kópavogur, Hafnarfjörður, and Garðabær, nearby Reykjanesbær where the international airport is located, and the town of Akureyri in northern Iceland. The island of Grímsey on the Arctic Circle contains the northernmost habitation of Iceland, whereas Kolbeinsey contains the northernmost point of Iceland.[68] Iceland has three national parks: Vatnajökull National Park, Snæfellsjökull National Park, and Þingvellir National Park.The country is considered a "strong performer" in environmental protection, having been ranked 13th in Yale University's Environmental Performance Index of 2012

geology

A geologically young land at 16 to 18 million years old, Iceland is the surface expression of the Iceland Plateau, a large igneous province forming as a result of volcanism from the Iceland hotspot and along the Mid-Atlantic Ridge, the latter of which runs right through it. This means that the island is highly geologically active with many volcanoes including Hekla, Eldgjá, Herðubreið, and Eldfell. The volcanic eruption of Laki in 1783–1784 caused a famine that killed nearly a quarter of the island's population.In addition, the eruption caused dust clouds and haze to appear over most of Europe and parts of Asia and Africa for several months afterwards, and affected climates in other areas.

Iceland has many geysers, including Geysir, from which the English word is derived, and the famous Strokkur, which erupts every 8–10 minutes. After a phase of inactivity, Geysir started erupting again after a series of earthquakes in 2000. Geysir has since grown quieter and does not erupt often.

With the widespread availability of geothermal power and the harnessing of many rivers and waterfalls for hydroelectricity, most residents have access to inexpensive hot water, heating, and electricity. The island is composed primarily of basalt, a low-silica lava associated with effusive volcanism as has occurred also in Hawaii. Iceland, however, has a variety of volcanic types (composite and fissure), many producing more evolved lavas such as rhyolite and andesite. Iceland has hundreds of volcanoes with about 30 active volcanic systems.

Surtsey, one of the youngest islands in the world, is part of Iceland. Named after Surtr, it rose above the ocean in a series of volcanic eruptions between 8 November 1963 and 5 June 1968.Only scientists researching the growth of new life are allowed to visit the island.

On 21 March 2010, a volcano in Eyjafjallajökull in the south of Iceland erupted for the first time since 1821, forcing 600 people to flee their homes.Additional eruptions on 14 April forced hundreds of people to abandon their homes. The resultant cloud of volcanic ash brought major disruption to air travel across Europe.

High-field overview of the area around Reykir

Another large eruption occurred on 21 May 2011. This time it was the Grímsvötn volcano, located under the thick ice of Europe's largest glacier, Vatnajökull. Grímsvötn is one of Iceland's most active volcanoes, and this eruption was much more powerful than the 2010 Eyjafjallajökull activity, with ash and lava hurled 20 km (12 mi) into the atmosphere, creating a large cloud.

A great deal of volcanic activity was occurring in the Reykjanes Peninsula in 2020 and into 2021, after nearly 800 years of inactivity. After the eruption of the Fagradalsfjall volcano on 19 March 2021, National Geographic's experts predicted that this "may mark the start of decades of volcanic activity." The eruption was small, leading to a prediction that this volcano was unlikely to threaten "any population centers".

The highest elevation for Iceland is listed as 2,110 m (6,920 ft) at Hvannadalshnúkur (64°00′N 16°39′W).

climate

The climate of Iceland's coast is subarctic. The warm North Atlantic Current ensures generally higher annual temperatures than in most places of similar latitude in the world. Regions in the world with similar climates include the Aleutian Islands, the Alaska Peninsula, and Tierra del Fuego, although these regions are closer to the equator. Despite its proximity to the Arctic, the island's coasts remain ice-free through the winter. Ice incursions are rare, with the last having occurred on the north coast in 1969.

The climate varies between different parts of the island. Generally speaking, the south coast is warmer, wetter, and windier than the north. The Central Highlands are the coldest part of the country. Low-lying inland areas in the north are the aridest. Snowfall in winter is more common in the north than in the south.

The highest air temperature recorded was 30.5 °C (86.9 °F) on 22 June 1939 at Teigarhorn on the southeastern coast. The lowest was −38 °C (−36.4 °F) on 22 January 1918 at Grímsstaðir and Möðrudalur in the northeastern hinterland. The temperature records for Reykjavík are 26.2 °C (79.2 °F) on 30 July 2008, and −24.5 °C (−12.1 °F) on 21 January 1918.

plants and animals

Plants

Phytogeographically, Iceland belongs to the Arctic province of the Circumboreal Region within the Boreal Kingdom. Plantlife consists mainly of grassland, which is regularly grazed by livestock. The most common tree native to Iceland is the northern birch (Betula pubescens), which formerly formed forests over much of Iceland, along with aspens (Populus tremula), rowans (Sorbus aucuparia), common junipers (Juniperus communis), and other smaller trees, mainly willows.

When the island was first settled, it was extensively forested, with around 30% of the land covered in trees. In the late 12th century, Ari the Wise described it in the Íslendingabók as "forested from mountain to sea shore".[87] Permanent human settlement greatly disturbed the isolated ecosystem of thin, volcanic soils and limited species diversity. The forests were heavily exploited over the centuries for firewood and timber.Deforestation, climatic deterioration during the Little Ice Age, and overgrazing by sheep imported by settlers caused a loss of critical topsoil due to erosion. Today, many farms have been abandoned. Three-quarters of Iceland's 100,000 square kilometres (39,000 sq mi) is affected by soil erosion; 18,000 km2 (6,900 sq mi) is affected to a degree serious enough to make the land useless. Only a few small birch stands now exist in isolated reserves. The planting of new forests has increased the number of trees, but the result does not compare to the original forests. Some of the planted forests include introduced species.The tallest tree in Iceland is a sitka spruce planted in 1949 in Kirkjubæjarklaustur; it was measured at 25.2 m (83 ft) in 2013.[89] Algae such as Chondrus crispus, Phyllphora truncata and Phyllophora crispa and others have been recorded from Iceland.[90]

Animals

The Arctic fox is the only indigenous land mammal in Iceland and was the only land mammal before the arrival of humans.

The only native land mammal when humans arrived was the Arctic fox,which came to the island at the end of the ice age, walking over the frozen sea. On rare occasions, bats have been carried to the island with the winds, but they are not able to breed there. No native or free-living reptiles or amphibians are on the island.

The animals of Iceland include the Icelandic sheep, cattle, chickens, goats, the sturdy Icelandic horse, and the Icelandic Sheepdog, all descendants of animals imported by Europeans. Wild mammals include the Arctic fox, mink, mice, rats, rabbits, and reindeer. Polar bears occasionally visit the island, travelling from Greenland on icebergs, but no Icelandic populations exist. In June 2008, two polar bears arrived in the same month. Marine mammals include the grey seal (Halichoerus grypus) and harbour seal (Phoca vitulina).

Many species of fish live in the ocean waters surrounding Iceland, and the fishing industry is a major part of Iceland's economy, accounting for roughly half of the country's total exports. Birds, especially seabirds, are an important part of Iceland's animal life. Atlantic puffins, skuas, and black-legged kittiwakes nest on its sea cliffs.

Commercial whaling is practised intermittently along with scientific whale hunts.Whale watching has become an important part of Iceland's economy since 1997.

Around 1,300 species of insects are known in Iceland. This is low compared with other countries (over one million species have been described worldwide). Iceland is essentially free of mosquitoes.

politics

Iceland has a left–right multi-party system. Following the 2017 and 2021 parliamentary elections, the biggest parties are the centre-right Independence Party (Sjálfstæðisflokkurinn), the Progressive Party (Framsóknarflokkurinn) and the Left-Green Movement (Vinstrihreyfingin – grænt framboð). These three parties form the ruling coalition in the cabinet led by leftist Katrín Jakobsdóttir. Other political parties with seats in the Althing (Parliament) are the Social Democratic Alliance (Samfylkingin), the People's Party (Flokkur fólksins), Iceland's Pirates (Píratar), the Reform Party (Viðreisn) and the Centre Party (Miðflokkurinn).

Iceland was the first country in the world to have a political party formed and led entirely by womenKnown as the Women's List or Women's Alliance (Kvennalistinn), it was founded in 1983 to advance the political, economic, and social needs of women. After participating in its first parliamentary elections, the Women's List helped increase the proportion of female parliamentarians by 15%.It disbanded in 1999, formally merging the next year with the Social Democratic Alliance, although about half of its members joined the Left-Green Movement instead. It did leave a lasting influence on Iceland's politics: every major party has a 40% quota for women, and in 2009 nearly a third of members of parliament were female, compared to the global average of 16%.Following the 2016 and 2021 elections, 48% of members of parliament are female.

In 2016, Iceland was ranked second in the strength of its democratic institutions and 13th in government transparency.The country has a high level of civic participation, with 81.4% voter turnout during the most recent elections, compared to an OECD average of 72%. However, only 50% of Icelanders say they trust their political institutions, slightly less than the OECD average of 56% (and most probably a consequence of the political scandals in the wake of the Icelandic financial crisis)

Government

See also: Government of IcelandThe Parliament of Iceland in ReykjavíkThe Cabinet of Iceland and the Prime Minister's Office in ReykjavíkA 19th-century depiction of the Alþingi of the Commonwealth in session at Þingvellir

Iceland is a representative democracy and a parliamentary republic. The modern parliament, Alþingi (English: Althing), was founded in 1845 as an advisory body to the Danish monarch. It was widely seen as a re-establishment of the assembly founded in 930 in the Commonwealth period and temporarily suspended from 1799 to 1845. Consequently, "it is arguably the world's oldest parliamentary democracy."It has 63 members, elected for a maximum period of four years.

The head of government is the prime minister who, together with the cabinet, is responsible for executive government.

The president of Iceland, in contrast, is a largely ceremonial head of state and serves as a diplomat, but may veto laws voted by the parliament and put them to a national referendum.They are elected by popular vote for a term of four years with no term limit. The current president is Guðni Th. Jóhannesson. On 1 August 2016, he became the new president of Iceland, and he was re-elected with an overwhelming majority of the vote in the 2020 presidential election.

The elections for the president, the Althing, and local municipal councils are all held separately every four years.

The cabinet in the country's government is typically appointed by the president after a general election to the Althing. However, the appointment is usually negotiated by the leaders of the political parties, who decide amongst themselves which parties can form the cabinet and how to distribute its seats, as long as it has majority support in the Althing. If the party leaders are unable to come to an agreement within a reasonable period of time, the president will personally appoint the cabinet. This has not happened since the republic was founded in 1944, although in 1942 the regent, Sveinn Björnsson, appointed a non-parliamentary government. Sveinn held the practical position of a president at the time, and later became the country's first official president in 1944.

The governments of Iceland have always been coalition governments, with two or more parties involved, as no single political party has ever received a majority of seats in the Althing throughout the republican period. There is no legal consensus on the extent of the political power possessed by the office of the president; several provisions of the constitution appear to give the president some important powers, but other provisions and traditions suggest differently.In 1980, Icelanders elected Vigdís Finnbogadóttir as president, the world's first directly elected female head of state. She retired from office in 1996. In 2009, Iceland became the first country with an openly gay head of government when Jóhanna Sigurðardóttir became prime minister.

Administrative divisions

Iceland is divided into regions, constituencies, and municipalities. The eight regions are primarily used for statistical purposes. District court jurisdictions also use an older version of this division. Until 2003, the constituencies for the parliamentary elections were the same as the regions, but by an amendment to the constitution, they were changed to the current six constituencies:

Reykjavík North and Reykjavík South (city regions);
Southwest (four non-contiguous suburban areas around Reykjavík);
Northwest and Northeast (northern half of Iceland, split); and
South (southern half of Iceland, excluding Reykjavík and suburbs).

The redistricting change was made to balance the weight of different districts of the country since previously a vote cast in the sparsely populated areas around the country would count much more than a vote cast in the Reykjavík city area. The imbalance between districts has been reduced by the new system but still exists

Sixty-nine municipalities in Iceland govern local matters like schools, transport, and zoning. These are the actual second-level subdivisions of Iceland, as the constituencies have no relevance except in elections and for statistical purposes. Reykjavík is by far the most populous municipality, about four times more populous than Kópavogur, the second one.

foreign relations - energy

Iceland, which is a member of the UN, NATO, EFTA, Council of Europe, and OECD, maintains diplomatic and commercial relations with practically all nations, but its ties with the Nordic countries, Germany, the United States, Canada, and the other NATO nations are particularly close. Historically, due to cultural, economic, and linguistic similarities, Iceland is a Nordic country, and it participates in intergovernmental cooperation through the Nordic Council.

Iceland is a member of the European Economic Area (EEA), which allows the country access to the single market of the European Union (EU). It was not a member of the EU, but in July 2009, the Icelandic parliament, the Althing, voted in favour of the application for EU membership and officially applied on 17 July 2009. However, in 2013, opinion polls showed that many Icelanders were now against joining the EU; following the 2013 Icelandic parliamentary election the two parties that formed the island's new government—the centrist Progressive Party and the right-wing Independence Party—announced they would hold a referendum on EU membership.In 2015, Minister for Foreign Affairs Gunnar Bragi Sveinsson informed the EU that Iceland would no longer pursue membership, but the application was not formally withdrawn and there have been subsequent calls for a referendum on the issue.

The Prime Minister of Iceland meets with the First Minister of Scotland Nicola Sturgeon at Bute House in 2019.

Military

Main article: Military of Iceland

Iceland has no standing army but has the Icelandic Coast Guard which also maintains the Iceland Air Defence System, and an Iceland Crisis Response Unit to support peacekeeping missions and perform paramilitary functions.

The Iceland Defense Force (IDF) was a military command of the United States Armed Forces from 1951 to 2006. The IDF, created at the request of NATO, came into existence when the United States signed an agreement to provide for the defence of Iceland. The IDF also consisted of civilian Icelanders and military members of other NATO nations. The IDF was downsized after the end of the Cold War and the U.S. Air Force maintained four to six interceptor aircraft at the Naval Air Station Keflavik until they were withdrawn on 30 September 2006. Since May 2008, NATO nations have periodically deployed fighters to patrol Icelandic airspace under the Icelandic Air Policing mission. Iceland supported the 2003 invasion of Iraq despite much domestic controversy, deploying a Coast Guard EOD team to Iraq,[125] which was replaced later by members of the Iceland Crisis Response Unit. Iceland has also participated in the conflict in Afghanistan and the 1999 NATO bombing of Yugoslavia.Despite the ongoing financial crisis the first new patrol ship in decades was launched on 29 April 2009.

Iceland was the neutral host of the historic 1986 Reagan–Gorbachev summit in Reykjavík, which set the stage for the end of the Cold War. Iceland's principal historical international disputes involved disagreements over exclusive economic zones. Conflict with the United Kingdom led to a series of so-called Cod Wars, which included confrontations between the Icelandic Coast Guard and the Royal Navy over British fishermen: in 1952–1956 due to the extension of Iceland's fishing zone from 3 to 4 nmi (5.6 to 7.4 km; 3.5 to 4.6 mi), in 1958–1961 following a further extension to 12 nmi (22.2 km; 13.8 mi), in 1972–1973 with another extension to 50 nmi (92.6 km; 57.5 mi), and in 1975–1976 after another extension to 200 nmi (370.4 km; 230.2 mi).

According to the 2011 Global Peace Index, Iceland is the most peaceful country in the world, due to its lack of armed forces, low crime rate and high level of socio-political stability.Iceland is listed in Guinness World Records as the "country ranked most at peace" and the "lowest military spending per capita".

Environmental policy

Iceland's official governmental goal is to cut greenhouse gas emissions by 40% by the year 2030 and reach carbon neutrality by the year 2040.

The Icelandic Forest Service and other forestry groups promote large-scale reforestation in the country. Before the first human settlement, 25–40% of the country was covered by forest. The Vikings cut them for fuel, building, and making iron. Due to the reforestation efforts, the forest cover of Iceland increased six-fold since the 1990s. This helps to offset carbon emissions, prevent sand storms and increase the productivity of farms.

Economy

Main article: Economy of IcelandA proportional representation of Iceland's exports, 2019Akureyri is the largest town in Iceland outside the Capital Region. Most rural towns are based on the fishing industry, which provides 40% of Iceland's exports.

In 2007, Iceland was the seventh-most productive country in the world per capita (US$54,858), and the fifth-most productive by GDP at purchasing power parity ($40,112). About 85 percent of the total primary energy supply in Iceland is derived from domestically produced renewable energy sources. Use of abundant hydroelectric and geothermal power has made Iceland the world's largest electricity producer per capita.As a result of its commitment to renewable energy, the 2016 Global Green Economy Index ranked Iceland among the top 10 greenest economies in the world.Historically, Iceland's economy depended heavily on fishing, which still provides 40% of export earnings and employs 7% of the workforce. The economy is vulnerable to declining fish stocks and falls in world prices for its main material exports: fish and fish products, aluminium, and ferrosilicon. Whaling in Iceland has been historically significant. Iceland still relies heavily on fishing, but its importance is diminishing from an export share of 90% in the 1960s to 40% in 2006.

Until the 20th century, Iceland was a fairly poor country. It is now one of the most developed countries in the world. Strong economic growth led Iceland to be ranked third in the United Nations' Human Development Index report for 2021/2022. According to the Economist Intelligence Index of 2011, Iceland had the second-highest quality of life in the world. Based on the Gini coefficient, Iceland also has one of the lowest rates of income inequality in the world, and when adjusted for inequality, its HDI ranking is sixth. Iceland's unemployment rate has declined consistently since the crisis, with 4.8% of the labour force being unemployed as of June 2012, compared to 6% in 2011 and 8.1% in 2010.

Many political parties remain opposed to EU membership, primarily due to Icelanders' concern about losing control over their natural resources (particularly fisheries).

The national currency of Iceland is the Icelandic króna (ISK). Iceland is the only country in the world to have a population under two million yet still have a floating exchange rate and an independent monetary policy.

A poll released on 5 March 2010 by Capacent Gallup showed that 31% of respondents were in favour of adopting the euro and 69% opposed. Another Capacent Gallup poll conducted in February 2012 found that 67.4% of Icelanders would reject EU membership in a referendum.

Iceland's economy has been diversifying into manufacturing and service industries in the last decade, including software production, biotechnology, and finance; industry accounts for around a quarter of economic activity, while services comprise close to 70%.The tourism sector is expanding, especially in ecotourism and whale-watching. On average, Iceland receives around 1.1 million visitors annually, which is more than three times the native population.1.7 million people visited Iceland in 2016, 3 times more than the number that came in 2010. Iceland's agriculture industry, accounting for 5.4% of GDP, consists mainly of potatoes, green vegetables (in greenhouses), mutton, and dairy products.The financial centre is Borgartún in Reykjavík, which hosts a large number of companies and three investment banks. Iceland's stock market, the Iceland Stock Exchange (ISE), was established in 1985.

Iceland is ranked 27th in the 2012 Index of Economic Freedom, lower than in prior years but still among the freest in the world. As of 2016, it ranks 29th in the World Economic Forum's Global Competitive Index, one place lower than in 2015. According to the Global Innovation Index, Iceland is the 20th most innovative country in the world in 2022.Unlike most Western European countries, Iceland has a flat tax system: the main personal income tax rate is a flat 22.75% and combined with municipal taxes, the total tax rate equals no more than 35.7%, not including the many available deductions.The corporate tax rate is a flat 18%, one of the lowest in the world. There is also a value added tax, whereas a net wealth tax was eliminated in 2006. Employment regulations are relatively flexible and the labour market is one of the freest in the world. Property rights are strong and Iceland is one of the few countries where they are applied to fishery management. Like other welfare states, taxpayers pay various subsidies to each other, but with spending being less than in most European countries.

Despite low tax rates, agricultural assistance is the highest among OECD countries and a potential impediment to structural change. Also, health care and education spending have relatively poor returns by OECD measures, though improvements have been made in both areas. The OECD Economic Survey of Iceland 2008 highlighted Iceland's challenges in currency and macroeconomic policy. There was a currency crisis that started in the spring of 2008, and on 6 October trading in Iceland's banks was suspended as the government battled to save the economy. An assessment by the OECD 2011 determined that Iceland has made progress in many areas, particularly in creating a sustainable fiscal policy and restoring the health of the financial sector; however, challenges remain in making the fishing industry more efficient and sustainable, as well as in improving monetary policy to address inflation.Iceland's public debt has decreased since the economic crisis, and as of 2015 is the 31st-highest in the world by proportion of national GDP.

Economic contraction

Iceland was hit especially hard by the Great Recession that began in December 2007 because of the failure of its banking system and a subsequent economic crisis. Before the crash of the country's three largest banks, Glitnir, Landsbanki and Kaupthing, their combined debt exceeded approximately six times the nation's gross domestic product of €14 billion ($19 billion). In October 2008, the Icelandic parliament passed emergency legislation to minimise the impact of the financial crisis. The Financial Supervisory Authority of Iceland used permission granted by the emergency legislation to take over the domestic operations of the three largest banks. Icelandic officials, including central bank governor Davíð Oddsson, stated that the state did not intend to take over any of the banks' foreign debts or assets. Instead, new banks were established to take on the domestic operations of the banks, and the old banks were to be run into bankruptcy.

On 28 October 2008, the Icelandic government raised interest rates to 18% (as of August 2019, it was 3.5%), a move forced in part by the terms of acquiring a loan from International Monetary Fund (IMF). After the rate hike, trading on the Icelandic króna finally resumed on the open market, with a valuation at around 250 ISK per euro, less than one-third the value of the 1:70 exchange rate during most of 2008, and a significant drop from the 1:150 exchange ratio of the week before. On 20 November 2008, the Nordic countries agreed to lend Iceland $2.5 billion.

On 26 January 2009, the coalition government collapsed due to public dissent over the handling of the financial crisis. A new left-wing government was formed a week later and immediately set about removing Central Bank governor Davíð Oddsson and his aides from the bank through changes in the law. Davíð was removed on 26 February 2009 in the wake of protests outside the Central Bank.

Thousands of Icelanders left the country after the collapse, many of those moving to Norway. In 2005, 293 people moved from Iceland to Norway; in 2009, the figure was 1,625. In April 2010, the Icelandic Parliament's Special Investigation Commission published the findings of its investigation,revealing the extent of control fraud in this crisis.By June 2012, Landsbanki managed to repay about half of the Icesave debt.

According to Bloomberg in 2014, Iceland was on the trajectory of 2% unemployment as a result of crisis-management decisions made back in 2008, including allowing the banks to fail.

Transport

Iceland has a high level of car ownership per capita, with a car for every 1.5 inhabitants; it is the main form of transport. Iceland has 13,034 km (8,099 mi) of administered roads, of which 4,617 km (2,869 mi) are paved and 8,338 km (5,181 mi) are not. A great number of roads remain unpaved, mostly little-used rural roads. The road speed limits are 30 and 50 km/h (19 and 31 mph) in towns, 80 km/h (50 mph) on gravel country roads and 90 km/h (56 mph) on hard-surfaced roads.

Route 1, or the Ring Road (Icelandic: Þjóðvegur 1 or Hringvegur), was completed in 1974, and is the main road that runs around Iceland and connects all the inhabited parts of the island, with the interior of the island being uninhabited. This paved road is 1,332 km (828 mi) long with one lane in each direction, except near larger towns and cities and in the Hvalfjörður Tunnel where it has more lanes. Many bridges on it, especially in the north and east, are single lanes and made of timber or steel.

Keflavík International Airport (KEF)is the largest airport and the main aviation hub for international passenger transport. It serves several international and domestic airline companies.KEF is in the vicinity of the larger metropolitan capital areas, 49 km (30 mi) to the WSW of Reykjavík centre, and public bus services are available.

Iceland has no passenger railways.

Reykjavík Airport (RKV) is the second-largest airport, located just 1.5 km from the capital centre. RKV serves general aviation traffic and has daily or regular domestic flights to 12 local townships within Iceland. RKV also serves international flights to Greenland and the Faroe Islands, business and private aeroplanes along with aviation training.

Akureyri Airport (AEY) and Egilsstaðir Airport (EGS) are two other domestic airports with limited international service capacity. There are a total of 103 registered airports and airfields in Iceland; most of them are unpaved and located in rural areas. The second-longest runway is at Geitamelur, a four-runway glider field around 100 km (62 mi) east of Reykjavík.

Several ferry services provide regular access to various outpost communities or shorten travel distances.

Energy

Renewable sources—geothermal and hydropower—provide effectively all of Iceland's electricity and around 85% of the nation's total primary energy consumption, with most of the remainder consisting of imported oil products used in transportation and in the fishing fleet.A 2000 report from the University of Iceland suggested that Iceland could potentially convert from oil to hydrogen power by 2040.Iceland's largest geothermal power plants are Hellisheiði and Nesjavellir, while Kárahnjúkar Hydropower Plant is the country's largest hydroelectric power station. When the Kárahnjúkavirkjun started operating, Iceland became the world's largest electricity producer per capita. Iceland is one of the few countries that have filling stations dispensing hydrogen fuel for cars powered by fuel cells.

Despite this, Icelanders emitted 16.9 tonnes of CO2 per capita in 2016, the highest among EFTA and EU members, mainly resulting from transport and aluminium smelting.Nevertheless, in 2010, Iceland was reported by Guinness World Records as "the Greenest Country", reaching the highest score by the Environmental Sustainability Index, which measures a country's water use, biodiversity and adoption of clean energies, with a score of 93.5/100.

On 22 January 2009, Iceland announced its first round of offshore licences for companies wanting to conduct hydrocarbon exploration and production in a region northeast of Iceland, known as the Dreki area. Three exploration licences were awarded but all were subsequently relinquished.

Education and science

See also: Education in Iceland and Science and technology in IcelandReykjavík Junior College (Menntaskólinn í Reykjavík), located in downtown Reykjavík, is the oldest gymnasium in Iceland.

The Ministry of Education, Science and Culture is responsible for the policies and methods that schools must use, and they issue the National Curriculum Guidelines. However, playschools, primary schools, and lower secondary schools are funded and administered by the municipalities. The government does allow citizens to home educate their children, however, under a very strict set of demands.Students must adhere closely to the government-mandated curriculum, and the parent teaching must acquire a government approved teaching certificate.

Nursery school, or leikskóli, is non-compulsory education for children younger than six years and is the first step in the education system. The current legislation concerning playschools was passed in 1994. They are also responsible for ensuring that the curriculum is suitable to make the transition into compulsory education as easy as possible.

Compulsory education, or grunnskóli, comprises primary and lower secondary education, which often is conducted at the same institution. Education is mandatory by law for children aged from 6 to 16 years. The school year lasts nine months, beginning between 21 August and 1 September, and ending between 31 May and 10 June. The minimum number of school days was once 170, but after a new teachers' wage contract, it increased to 180. Lessons take place five days a week. All public schools have mandatory education in Christianity, although an exemption may be considered by the Minister of Education.

Upper secondary education, or framhaldsskóli, follows lower secondary education. These schools are also known as gymnasia in English. Though not compulsory, everyone who has had a compulsory education has the right to upper secondary education. This stage of education is governed by the Upper Secondary School Act of 1996. All schools in Iceland are mixed-sex schools. The largest seat of higher education is the University of Iceland, which has its main campus in central Reykjavík. Other schools offering university-level instruction include Reykjavík University, University of Akureyri, Agricultural University of Iceland and Bifröst University.

An OECD assessment found that 64% of Icelanders aged 25–64 have earned the equivalent of a high-school degree, which is lower than the OECD average of 73%. Among 25- to 34-year-olds, only 69% have earned the equivalent of a high-school degree, significantly lower than the OECD average of 80%. Nevertheless, Iceland's education system is considered excellent: the Programme for International Student Assessment ranks it as the 16th best performing, above the OECD average.Students were particularly proficient in reading and mathematics.

According to a 2013 Eurostat report by the European Commission, Iceland spends around 3.11% of its GDP on scientific research and development (R&D), over 1 percentage point higher than the EU average of 2.03%, and has set a target of 4% to reach by 2020.Iceland was ranked 17th in the Global Innovation Index in 2021, up from 20th in 2019.A 2010 UNESCO report found that out of 72 countries that spend the most on R&D (US$100 million or more), Iceland ranked ninth by proportion of GDP, tied with Taiwan, Switzerland, and Germany and ahead of France, the United Kingdom and Canada.