Creative Industries Iceland: A Hub of Innovation and Nature-Inspired Creativity

Global Development Iceland at Red Yellow Blue (RYB)

Creative industries in Iceland thrive as a reflection of the country’s dramatic landscapes, rich cultural heritage, and innovative spirit. Renowned for its music, film, literature, fashion, and digital innovation, Iceland’s creative economy is deeply intertwined with its environment, history, and forward-thinking society, showcasing a unique blend of tradition and modernity.

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Creative Industries Iceland

Key Sectors in Iceland’s Creative Economy

  • Music
    Iceland’s music scene punches far above its weight, producing globally recognized artists such as Björk, Sigur Rós, and Of Monsters and Men. The annual Iceland Airwaves Festival in Reykjavík attracts music lovers and industry professionals from around the world, showcasing both established and emerging talent. Music is one of the country’s most successful cultural exports, contributing significantly to its creative economy.
  • Film and Television
    Iceland has become a sought-after location for international film and television productions due to its breathtaking landscapes. Productions like Game of Thrones and The Secret Life of Walter Mitty have put Iceland on the global map. The local film industry is also flourishing, with government support and initiatives such as the Icelandic Film Centre fostering domestic talent. Icelandic cinema often explores themes of nature, isolation, and resilience, resonating with global audiences.
  • Literature and Storytelling
    With a literacy rate of nearly 100% and a tradition of storytelling dating back to the Viking sagas, literature is a cornerstone of Icelandic culture. The country has one of the highest book publication rates per capita in the world. Reykjavík was designated a UNESCO City of Literature in 2011, reflecting its vibrant literary scene. Icelandic authors like Halldór Laxness, a Nobel laureate, continue to inspire new generations of writers.
  • Fashion and Design
    Icelandic fashion and design are characterized by minimalism, functionality, and a strong connection to nature. Designers often use sustainable materials and draw inspiration from the country’s landscapes and traditions. The DesignMarch festival and Erlendur Fashion Week Iceland provide platforms for local designers to showcase their work, attracting international attention.
  • Visual Arts and Crafts
    Visual arts in Iceland are deeply influenced by the island’s geography and light. Local artists like Olafur Eliasson have gained international acclaim for their innovative work. Crafts, including wool products and handmade jewelry, are popular among both locals and tourists.
  • Digital Innovation and Gaming
    Iceland is home to a growing digital creative sector, particularly in gaming. Companies like CCP Games, creators of the popular EVE Online, are leading the charge in this field. The country’s strong technological infrastructure and creative talent pool make it an ideal environment for digital innovation.

Trends and Challenges

  • Sustainability: Iceland’s commitment to environmental preservation is reflected in its creative industries, with a strong emphasis on sustainable practices in fashion, design, and production.
  • Global Reach: Despite its small population, Iceland’s creative industries have a significant global presence, aided by the country’s active participation in international festivals and collaborations.
  • Challenges: The high cost of living and limited domestic market pose challenges for creatives. However, government support and export-oriented strategies are helping to mitigate these issues.

Cultural Tourism and the Creative Economy

Cultural tourism is a vital aspect of Iceland’s creative economy. Visitors are drawn to festivals like Dark Music Days, Reykjavík International Film Festival, and Iceland Writers Retreat. These events not only promote Icelandic culture but also contribute to the local economy.

The Future of Iceland’s Creative Industries

Iceland’s creative industries are poised for continued growth, driven by innovation, sustainability, and a deep connection to its cultural heritage. Investments in education, infrastructure, and international partnerships will be crucial in ensuring the sector’s long-term success.

Iceland’s creative industries are a testament to the country’s ingenuity and cultural richness. By blending tradition with modernity and embracing global trends, Iceland continues to inspire and influence the world through its creative endeavors.

Creative industries Iceland

Creative industries are burgeoning sector of Icelandic economy that ranges from fine art to gaming and software development. And everything in between. Icelandic designers, filmmakers, authors and musicians draw inspiration from the rich cultural heritage and the extreme natural environment, while enjoying the advantages of close ties to global cultural trends.

Many local designers are heavily influenced by the stark contrasts of Iceland’s nature. This is clearly reflected by the use of unusual textiles and raw materials among designers of fashion- and footwear. Significant elements of nature are also reflected in modern architecture.

Creative Iceland

Creative Iceland facilitates the promotion of Iceland as a creative hub for music, art, literature, films, performing arts, and design. Creative Iceland seeks to increase awareness of Icelandic art and creative industries amongst consumers in international markets. The initiative aims to boost the export revenue of Iceland’s arts and creative industries by developing and incentivizing attractive options for creative people and companies in Iceland.
> islandsstofa.is/en/key-sectors-creative-industries

Population: 364,036
Capital: Reykjavik
Internet country code: .is

Economy

Iceland’s economy combines a capitalist structure and free-market principles with an extensive welfare system. Except for a brief period during the 2008 crisis, Iceland has in recent years achieved high growth, low unemployment, and a remarkably even distribution of income. Iceland’s economy has been diversifying into manufacturing and service industries in the last decade, particularly within the fields of tourism, software production, and biotechnology. Abundant geothermal and hydropower sources have attracted substantial foreign investment in the aluminum sector, boosted economic growth, and sparked some interest from high-tech firms looking to establish data centers using cheap green energy.

Tourism, aluminum smelting, and fishing are the pillars of the economy. For decades the Icelandic economy depended heavily on fisheries, but tourism has now surpassed fishing and aluminum as Iceland’s main export industry. Tourism accounted for 8.6% of Iceland’s GDP in 2016, and 39% of total exports of merchandise and services. From 2010 to 2017, the number of tourists visiting Iceland increased by nearly 400%. Since 2010, tourism has become a main driver of Icelandic economic growth, with the number of tourists reaching 4.5 times the Icelandic population in 2016. Iceland remains sensitive to fluctuations in world prices for its main exports, and to fluctuations in the exchange rate of the Icelandic Krona.

Following the privatization of the banking sector in the early 2000s, domestic banks expanded aggressively in foreign markets, and consumers and businesses borrowed heavily in foreign currencies. Worsening global financial conditions throughout 2008 resulted in a sharp depreciation of the krona vis-a-vis other major currencies. The foreign exposure of Icelandic banks, whose loans and other assets totaled nearly nine times the country’s GDP, became unsustainable. Iceland’s three largest banks collapsed in late 2008. GDP fell 6.8% in 2009, and unemployment peaked at 9.4% in February 2009. Three new banks were established to take over the domestic assets of the collapsed banks. Two of them have majority ownership by the state, which intends to re-privatize them.

Since the collapse of Iceland’s financial sector, government economic priorities have included stabilizing the krona, implementing capital controls, reducing Iceland’s high budget deficit, containing inflation, addressing high household debt, restructuring the financial sector, and diversifying the economy. Capital controls were lifted in March 2017, but some financial protections, such as reserve requirements for specified investments connected to new inflows of foreign currency, remain in place.