Iceland Mag

7 Reykjavik

Iceland Mag

Economy

Tourism's contribution to GDP doubled since 2010: 8.2% of GDP in 2016

By Staff

  • Navigating Ice and snow at Seljalandsfoss Tourism has quickly become a major pillar of the Icelandic economy. Photo/Pjetur

Tourism has become a major pillar of the Icelandic economy since 2010. The current boom in tourism began in 2010, when the Eyjafjallajökull eruption focused the world's attention on Iceland. Since then the share of tourism in GDP has grown every year, from ca 3% in 2011 to 6.7% in 2015, the latest year for which Statistics Iceland has figures.

According to figures from Statistics Iceland tourism's share of GDP was 5.6% in 2014 and 4.9% in 2013. Statistics Iceland notes that not only has the share of tourism in the gross domestic product of Iceland increased each year since 2011, the rate of growth has also increased. 

Statistics Iceland has not yet released figures on the share of tourism in 2016, but analysis by economists at Landsbankinn bank puts this figure at 8.2%. However, Landsbankinn also estimates that tourism made a larger contribution to GDP in 2010 than Statistics Iceland. Landsbankinn estimates that tourism contributed 4.7% to GDP in 2010. 

Read more: More signs growth in tourism is starting to level off: Only 2% increase in hotel stays

Despite the growing importance of tourism it still contributes less to Icelandic GDP than other industries, most notably fishing and fish processing, which contributed 8.2% to GDP. The total number of foreign visitors grew by 36% in 2016, compared to a growth of 27% in 2015. However, there are signs that the growth in tourism has slowed down in 2017, compared to 2016.

Editor's Picks