Finance Minister Targets Stronger Economic Growth

2026-02-17 - 12:38

The government remains committed to delivering a deficit-free budget by 2027, according to Finance and Economic Affairs Minister Daði Már Kristófersson. As reported by RÚV, he said on the current affairs show, Silfrið, that economic growth is expected to strengthen this year. What's the Story? Deficit-free state budget targeted by 2027, according to Finance and Economic Affairs Minister Daði Már Kristófersson Economic growth forecast higher this year than last, despite slower population growth Inflation and labour market developments identified as areas of concern Budget Target Defended The minister said forecasts indicate higher overall growth compared with last year, despite a slowdown in population growth. He rejected suggestions that economic indicators have broadly deteriorated since the start of the parliamentary term. “There is actually only one indicator, maybe two, that is not trending as we would have liked. On the one hand, inflation, which is higher than I would have liked to see, and on the other hand, of course, the development in the labour market is a cause for concern.” He said unemployment is primarily affecting people with backgrounds other than Icelandic and described the labour market as having weakened. However, he maintained that overall performance remains solid. “It is predicted to be higher this year than last year, and this is happening at the same time that the high population growth, which has maintained economic growth in Iceland for some time now, has been decreasing,” he said. “If we don’t see an increase in GDP per capita, it means that the strain on our system is increasing without us seeing an increase in income to support it. I actually don’t accept that the economic development has been unfavourable. On the contrary, I am actually surprised about how incredibly stable and able to withstand shocks the Icelandic economy is.”