Economic statistics - 01.02.1980, Blaðsíða 4

FOREWORD
The Central Bank of lceland has since 1974
published a monthly bulletin of economic
statistics in lcelandic, which has already
proved its usefulness in lceland and for those
readers abroad for whom the language prob-
lem has not been a barrier. However, numer-
ous inquiries which the Bank and other eco-
nomic institutions in Iceland get every year
from abroad, have demonstrated the neces-
sity of making available on a regular basis in-
formation in English on economic develop-
ments in Iceland. It is hoped that this need
will be adequately met by this present publi-
cation which will appear on a quarterly basis.
As well as providing the most recently avail-
able data from various sources this new bul-
letin contains longer time series in order to
enable unacquainted readers to familiarize
themselves with the development of the vari-
ous economic indicators over a period of
several years.
It is hoped that this new bulletin may be-
come a useful medium for the channelling
of economic information on Iceland, and any
comments for its improvement from readers
abroad will be gratefully received.
ECONOMIC DEVELOPMENTS IN 1979
Developments in Iceland in 1979 were
strongly influenced by the sharp increase in
oil prices which resulted in an estimated 11
per cent deterioration in the terms of trade.
A second characteristic was the high and ris-
ing rate of inflation as witnessed by an aver-
age rise in the cost of living of some 46 per
cent between 1978 and 1979. The oil price ris-
es figure heavily in the maintenance of the
rate of inflation, as the prices of imported
fuels are predominantly based on spot prices
on the Rotterdam market which rose extra-
ordinarily sharply in 1979.
Production
According to forecasts made by the Na-
tional Economic Institute real GNP rose by
some 3 per cent in 1979 following the strong
growth of 4.2 and 6 per cent in 1978 and 1977,
respectively. (See table on page 20) However,
due to the above mentioned worsening of the
terms of trade, real gross national income
fell by 0.7 per cent in 1979 and by 2 per cent
on per capita basis.
Production in most sectors was at a high
level. The fish catch, for example, reached
a record 1632 thousand tons .as compared
with 1548 thousand tons in 1978. Further-
more, there was an increase in manufacturing
production for exports with the exception of
aluminium production which fell slightly.
Production of ferro-silicon began in 1979.
All in all, it is estimated that export produc-
tion may have risen by some 12 per cent in 1979.
Prices, incomes and employment
As already mentioned, the cost of living
rose by46.3percentontheaveragefrom 1978
to 1979. Wage and salary rates are estimated
to have risen by some 42-43 per cent and dis-
posable personal income by some 44-45 per
cent. There were only very slight increases
in basic wage rates in 1979,3 per cent for most
wage earners in the late spring, so that most
of the increase in incomes was a result of the
indexation of wages to the price level. (Price
indices are shown in the table on page 24)
As in previous years, unemployment re-
mained low in 1979, only some 0.5 per cent
of the labour force, on the average (see table 1
on page 23).
Balance of payments
In 1978 there was a surplus on both visible
and invisible trade for the first time since
1970. In 1979 there was again a trade surplus
which may be considered remarkable in the
face of the sharp oil price rises, but Iceland’s
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