Country Report Iceland July 1998 Main report

Outlook for 1998-99: Opposition will be bound together in adversity

Having failed to make the sort of electoral inroads in the municipal elections that would represent a meaningful challenge in the general election, the four main opposition parties -- the People's Alliance, the Social Democratic Party, the People's Movement and the Women's List -- will be compelled to forge a closer alliance in order to have any chance of unseating the coalition. The emergence of former MP, Ingibjorg Solrun Gisladottir, a leading figure in the local politics in Reykjavik, as a potential pole around which the opposition can unite offers the best chance for the opposition.

Economic results and forecasts (Ikr bn at constant 1995 prices; % change year on year in brackets unless otherwise indicated) 1996(a) 1997(a) 1998(b) 1999(b) Private consumption 290.2 307.6 326 340.7 (6.4) (6.0) (6.0) (4.5) Government consumption 95.0 96.4 99.1 101.1 (1.0) (1.5) (2.8) (2.0) Gross fixed investment 83.4 91.7 101.8 107.4 (26.5) (9.9) (11.0) (5.5) Final domestic demand 468.7 495.8 526.9 549.2 (8.3) (5.8) (6.3) (3.8) Change in stocks -1.2 -0.8 -1.1 -2.6 (-0.3)© (-0.2)© (-0.2)© (-0.2)© Total domestic demand 467.7 494.8 525.8 546.6 (7.5) (5.8) (6.3) (3.5) Foreign balance 8.0 4.4 -3.6 -3.8 (-1.8)© (-0.8)© (-3.6)© (0.0)© GDP 476.4 500.2 522.7 542.0 (5.5) (5.0) (4.5) (3.7) Exports of goods & services 176.7 186.6 194.1 204.8 (9.6) (5.6) (4.0) (5.5) Imports of goods & services 168.7 182.2 195.7 205.5 (16.6) (8.0) (7.4) (5.0) (a) Actual. (b) EIU forecasts. © Change as a percentage of GDP in the previous year.

© 1998 The Economist lntelligence Unit Ltd. All rights reserved
Whilst every effort has been taken to verify the accuracy of this information, The Economist lntelligence Unit Ltd. cannot accept any responsibility or liability for reliance by any person on this information
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