In 2003 GDP per capita was 27.226 euro, equal to the amount in Spain but higher than in Greece. Compared to the other Nordic countries, GDP per capita is approximately 20 per cent lower than in Denmark and Iceland.
GDP is a measure of value added in domestic production. Adding net foreign income, we arrive at the disposable Gross National Income (dGNI), which is a measure of income available to the citizens. The dGNI is approximately 12 per cent higher than the GDP, and living standards are thus almost equal to the standards in neighbouring countries.
Total savings as a proportion of the disposable Gross National Income have fluctuated significantly in the Faroe Islands during the last few years. Total savings were 30 percent in 2002, but in 2003 they dropped to 23 percent.
The national accounts in the Faroese economy are only compiled in nominal terms at market prices. This means that major economic indicators, such as the GDP, do not measure real growth in the economy, because they include the effects of inflation. This caveat must be noted, as the relevant measure of economic activity is the real growth of the economy (i.e. in constant prices).
The national accounts are based on data from a wide variety of Statistics Faroe Islands economic data.
