Landshagir - 01.11.2011, Page 245

National accounts
LANDSHAGIR 2011 STATISTICAL YEARBOOK OF ICELAND 2011
13
245
National accounts are a coherent, consis­
tent and integrated set of macroeconomic
accounts, balance sheets and tables based
on a set of internationally agreed concepts,
definitions, classifications and accounting
rules. National accounts provide a compre­
hensive accounting framework within
which economic data can be compiled and
presented in a format that is designed for
purposes of economic analysis, decision­
making and policy­making.
Gross Domestic Product
The core item is the Gross Domes­
tic Product (GDP) which can be reached
through two main approaches, the expen­
diture approach and the production
approach. The main components of the
expenditure approach are household and
government consumption, gross fixed
capital consumption and exports and
imports where the output approach pres­
ents the value added by individual indus­
tries.
International standards
In order to ensure inter­temporal and
international comparability the national
accounts are compiled according to inter­
national standards. The Icelandic national
accounts are compiled according to the
European version of the United Nations
System of National Accounts (SNA 1993),
i.e. ESA 95. For further information on
methods applied see Gross National
Income Inventory (ESA95) 2008.
GDP decreased by 4% in 2010
The annual national accounts for 2010
show a 4% decrease in Gross Domestic
Product (GDP) in real terms. In 2009, GDP
decreased by 6.7% but grew at a rate of 1.3%
in 2008.
In 2010, domestic expenditure decreased
by 2.7%. Household final consumption
decreased by 0.4%, government final
consumption by 3.4% and fixed capital
formation by 8%. At the same time,
exports grew by 0.4% and imports by 4%.
However, owing to improved terms of
trade there was an increase in surplus in
the balance of goods and services from
126 billion ISK in 2009 to 154 billion ISK in
2010.
Positive change in the balance of trade
lowering the current account deficit
In spite of a slightly higher deficit in
primary income from abroad, the posi­
tive change in the balance of trade 2010
resulted in lowering the current account
deficit to 163 billion ISK or 10.6% of GDP,
compared with 166 billion ISK or 11.1% of
GDP in 2009. During 2010 the terms of
trade improved by 3.2% of GDP from the
previous year, having a similar impact on
Gross National Income (GNI). This favour­
able impact together with improvements
on the balance on current account lead to a
2.2% decrease in GNI compared with a 9.2%
decrease in 2009.
Household final consumption similar
to the year before
In 2010, the share of household final
consumption of GDP was 51.2%, experienc­
ing a three­year historical low. Government
final consumption amounted to 25.9% of
GDP, a little lower than in 2009.
The share of gross fixed capital formation
is the lowest share ever
The share of gross fixed capital forma­
tion was 13% of GDP in 2010. This is the
lowest share ever. A comparable figure
for the OECD total has been around 20%
during the last quarter of the century. In
real terms, gross fixed capital formation in
2010 was at the same level as in 1996.