National Accounts

The Faroe Islands system of national accounts includes production, income and expenditure accounts, which at their summary level reflect key economic flows - production, the distribution of incomes, consumption, saving and investment. At their more detailed level, they are designed to present a statistical picture of the structure of the economy and the detailed processes that make up domestic production and its distribution. The national accounts include many detailed classifications relating to major economic aggregates, e.g. by sector, by industry and by purpose).

Yet the compilation are only in nominal terms at market prices. This means that major economic indicators, such as the Gross Domestic Product (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.

The national accounts are based on data from a wide variety of Statistics Faroe Islands' economic data and are compiled based on the UN-guidelines given in the System of National Accounts (SNA).

The contribution from different industries to Gross Domestic Product changes over time. In 2009, the service industries accounted for about 60 per cent of GDP, compared with 50 per cent in 1998. In the same periode the contribution from the primary sector has decline from 20 to 10 per cent of GDP.