Published on : Tuesday, December 19, 2017
Iceland has become such a popular tourist destination that foreign visitors are expected to outnumber the local population by seven to one this year. The government of Iceland is now considering whether the scarcely populated island in the North Atlantic can accommodate more. “This sector is maturing and becoming a real industry in Iceland and with that of course come challenges that we need to be ready to tackle,” Thordis Kolbrun R. Gylfadottir, Iceland’s tourism minister, said in an interview in Reykjavik.
As many as 2.3 million people are expected to visit Iceland by the end of this year, or about 6,000-7,000 a day, up from nearly 1.8 million last year. Tourism is now Iceland’s biggest export and its second-biggest industry after wholesale and retail trade. In 2016, tourism accounted for 8.4 percent of gross domestic product.
Hence, with this importance of tourism as an industry in Iceland, a shock to tourism would be a “shock to the economy as a whole,” Sedlabanki said in its October Financial Stability report.
An idea recently being considered in Iceland is applying a special fee (the previous government called it a ‘nature pass’), whose proceeds would be used to finance the preservation of the island’s unique natural resources. The Iceland government is also open to greater foreign investment, now that capital controls have all but been removed.