The Republic of Iceland is a borderless nation in the northern Atlantic Ocean , located between Greenland and Scotland , northwest of the Faroe Islands .

 

 

Geography

Iceland is located on a geological hot spot on the Mid-Atlantic Ridge . The combination of being both on the Mid-Atlantic Ridge and on a hot spot means that the island is extremely geologically active. It has many active volcanoes , notably Hekla . Around 10% of the island is glaciated. Iceland has many geysers (itself an Icelandic word) and the widespread availability of geothermal power means residents of most towns have hot water and home heat for a low price. ( See also : Volcanoes of Iceland ) Electricity is generally very cheap because of the many rivers and waterfalls which are also used for the generation of electrical power. ( See also : Rivers of Iceland , Waterfalls of Iceland , Lakes of Iceland )

The island itself has many fjords along the coastline, where also most cities are situated, because the island's interior, the Highlands of Iceland are an uninhabitable desert. The main towns are the capital Reykjavík , Keflavík , where the national airport is situated, and Akureyri . The island of Grímsey , on the Arctic Circle contains the northernmost habitation of Iceland. ( See also: Fjords of Iceland )

Unlike neighbouring Greenland , Iceland is considered to be a part of Europe , not of America . The island is the world's 18th largest island .

The island has four national parks: Jökulsárgljúfur National Park , Skaftafell National Park , Snæfellsnes National Park and Þingvellir .

Military

The Republic of Iceland has no regular armed forces. Defense is provided by a US manned NATO base in Keflavík. Iceland has a Coast Guard (Landhelgisgæslan) and a SWAT team which is called Víkingasveitin (Viking Squad) and is under the command of the Reykjavík chief of police .

Economy

The economy depends heavily on the fishing industry, which provides over 60% of export earnings and employs 8% of the work force. In the absence of other natural resources (except for abundant hydro-electric and geothermal power), Iceland's economy is vulnerable to changing world fish prices. The economy remains sensitive to declining fish stocks as well as to drops in world prices for its main exports: fish and fish products, aluminum , and ferrosilicon . Although the Icelandic economy is heavily depentant on fishing it is constantly becoming less important as the travel industry, the technology industry and various other industries grow.

The only natural resource conversion is the manufacture of cement . Most buildings are concrete with expensive imported wood used only sparingly and where necessary.

The center-right government plans to continue its policies of reducing the budget and current account deficits, limiting foreign borrowing, containing inflation, revising agricultural and fishing policies, diversifying the economy, and privatizing state-owned industries. The government remains opposed to EU membership, primarily because of Icelanders' concern about losing control over their fishing resources.

Iceland's economy has been diversifying into manufacturing and service industries in the last decade, and new developments in software production, biotechnology , and financial services are taking place. The tourism sector is also expanding, with the recent trends in ecotourism and whale -watching. Growth slowed between 2000 and 2002, but the economy expanded by 4.3% in 2003 and is expected to grow by over 6% in 2004. The unemployment-rate of 2.6% (3rd quarter 2004) is the second lowest in the European Economic Area after Liechtenstein.

Demographics

The isolated location of Iceland has resulted in limited immigration and limited genetic inflow in its human population over hundreds of years. The resulting genetic similarity is being exploited today for genetic studies.

The language spoken is Icelandic , a Scandinavian language, and the religion is predominantly Lutheran .