- overview: The Faroese economy in 1995 and 1996 saw a
noticeable upturn after several years of decline brought on by a drop
in fish catches and declining prices and by over-spending by the
Faroese Home Rule Government (FHRG). In the early 1990s, property
values plummeted, and the FHRG had to bail out and merge the two
largest Faroese banks. Fishing is now improving; wage costs are
increasing; the FHRG's budget is almost in balance; and the large
foreign debt has come down significantly. Nevertheless, the total
dependence on fishing makes the Faroese economy extremely vulnerable,
and the reduction in the foreign debt is at the cost of low
investment. Oil finds close to the Faroese area give hope for deposits
in the immediate Faroese area, which may lay the basis for an eventual
economic rebound. Aided by a substantial annual subsidy from Denmark,
the Faroese have a standard of living comparable to the Danes and
other Scandinavians.

GDP: purchasing power parity - $800 million (1996 est.)

GDP - real growth rate: 6% (1996 est.)

GDP - per capita: purchasing power parity - $16,300 (1996 est.)

GDP - composition by sector:
agriculture: 20%
industry: 16%
services : 64% (1996 est.)

Inflation rate - consumer price index: 2.8% (1996 est.)

Labor force:
total: 20,345 (1995 est.)
by occupation: largely engaged in fishing, manufacturing,
transportation, and commerce

Unemployment rate: 11% (1996 est.)

Budget:
revenues : $467 million
expenditures: $468 million, including capital expenditures of $11
million (1996 est.)

Industries: fishing, shipbuilding, construction, handicrafts

Industrial production growth rate: NA%

Electricity - capacity: 91,000 kW 000 kW

Electricity - production: 175.4 million kWh

Electricity - consumption per capita: 4,043 kWh (1995)

Agriculture - products: milk, potatoes, vegetables; sheep; salmon
farming; fish

Exports:
total value: $362 million (f.o.b., 1995)
commodities : fish and fish products 92%, animal feedstuffs, transport
equipment (ships)
partners: Denmark 22.2%, UK 25.8%, Germany 9.7%, France 8.3%, Norway
6.2%, US 2.0%

Imports:
total value: $315.6 (c.i.f., 1995)
commodities: machinery and transport equipment 17.0%, consumer goods
33%, raw materials and semi-manufactures 26.9%, fuels 11.4%, fish and
salt 6.7%
partners : Denmark 34.5%, Norway 15.9%, UK 8.4% Germany 7.8%, Sweden
5.8%, US 1.5%

Debt - external: $767 million (1995 est.)

Economic aid: receives