The preliminary figures on the Icelandic balance of payments for the third quarter in 2016, released by the Icelandic Central Bank (PDF), show a dramatic improvement in the balance of payments, primarily due to tourism and services. As a result of the strongly positive balance of payments Iceland has become a net creditor to the rest of the world for the first time since the end of WWII. Icelandic assets abroad at the end of the third quarter were 4,040 billion ISK (36.5 billion USD /34.2 billion EUR), while Icelandic debt to foreign creditors was 3,680 billion ISK (33.4 billion USD/31.1 billion EUR).
Read more: Icelandic economy continues to boom: GDP grew by 10.2% in third quarter of 2016
The positive balance equals 3% of GDP. This represents a dramatic turnaround since 2009, when the net debt of Iceland to the rest of the world equaled 130% of GDP.
Már Guðmundsson, the Director of the Central Bank, noted that this was a historic moment:
Our best estimates indicate that Icelandic assets abroad outstripped Icelandic debt at the end of WWII, but we cannot confirm this with absolute certainty. If that is not the case, we probably have to go back to the Viking age to find a time when Icelanders owned more abroad than they owed to foreign creditors. But this is certainly something we have not experienced in recent history.
The preliminary figures on the Icelandic balance of payments for the third quarter in 2016, released by the Icelandic Central Bank (PDF), show a dramatic improvement in the balance of payments, primarily due to tourism and services. As a result of the strongly positive balance of payments Iceland has become a net creditor to the rest of the world for the first time since the end of WWII. Icelandic assets abroad at the end of the third quarter were 4,040 billion ISK (36.5 billion USD /34.2 billion EUR), while Icelandic debt to foreign creditors was 3,680 billion ISK (33.4 billion USD/31.1 billion EUR).
Read more: Icelandic economy continues to boom: GDP grew by 10.2% in third quarter of 2016
The positive balance equals 3% of GDP. This represents a dramatic turnaround since 2009, when the net debt of Iceland to the rest of the world equaled 130% of GDP.
Már Guðmundsson, the Director of the Central Bank, noted that this was a historic moment:
Our best estimates indicate that Icelandic assets abroad outstripped Icelandic debt at the end of WWII, but we cannot confirm this with absolute certainty. If that is not the case, we probably have to go back to the Viking age to find a time when Icelanders owned more abroad than they owed to foreign creditors. But this is certainly something we have not experienced in recent history.
