Is Iceland's economic miracle a social model for Europe?
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Our reporters returned to Iceland, some 10 years after the tiny island nation plunged into a deep crisis after the country’s banking system collapsed like a house of cards. Icelanders have since called virtually everything they know into question: their financial structures, politics and even the way their society works in general. This has resulted in a near miraculous economic rebound and social reform for the country, where women now play a key role.
With an unemployment rate of just 1 percent, a GDP growth of near 5 percent and investments soaring to 8.8 percent, Icelandic wages are now back at their pre-crisis levels. For the financial year of 2017, Iceland’s national balance sheet saw those of other European countries pale in comparison.
Reykjavik, the island nation’s capital, perfectly encapsulates the exceptional dynamic the country is now experiencing. Along the waterfront, cranes work around the clock as giant architectural projects constantly pop out of the ground: concert halls, convention centres, housing complexes, business establishments and luxury hotels.
Iceland’s impressive economic recovery has a great deal to do with its recent boom in tourism, which has allowed for several hundreds of millions of euros to be invested in the Icelandic capital. But that's far from the only reason.
In the few short years since Iceland sank into one of the deepest financial crises any European country has seen in modern time, it has already managed to climb out of its mountains of losses and swing into actual profit. Although the 330,000 strong population has had to live through crippling austerity, most of the measures imposed stand in stark contrast to those adopted by other crisis-hit countries.
Exchange and capital controls have been in place for almost 10 years now. And the Nordic island never offered to bail out its failing banks, instead it put the country’s corrupt bankers in prison.
The Icelandic society of today can best be described as hyperactive, constantly introducing new inventive forms of ensuring its people's involvement. Women, in particular, have been spearheading the country’s societal movements, and are now at the forefront of Iceland’s change.
Even though some inequalities still exist in Iceland, the nation has topped the World Economic Forum’s gender equality rankings for several years now. The country may very well be on its way to becoming a societal role model for other European nations.