OECD ECONOMIC SURVEYS : iceland 2021.

Description

Table of contents Basic statistics of Iceland, 2019 Executive summary Iceland stands up after a deep fall Monetary and fiscal policies are accommodative Regulation should be eased and skills improved Addressing climate change 1 Key policy insights The economy is recovering Monetary policy has been eased in response to the Covid-19 crisis The financial system is considered to be sound but vigilance is warranted Fiscal policy is supporting the economy Spending reforms should address long-standing weaknesses of public finance Tax reforms benefit low-income earners, innovative firms and the environment Social benefits are well targeted but tend to penalize second earners, often women Policies to increase productivity and employment Competitiveness has improved but is at risk Stringent regulation stifles competition Addressing skills gaps is key Improving public governance and integrity References 2 Fostering innovation for the digital era Iceland has scope to become more innovative and productive Improving R&D support for businesses Unlocking innovation potential through R&D support Greater coordination will strengthen the innovation system Encouraging firms to adopt advanced technologies High-speed broadband could be utilised more by firms Improving framework conditions Improving access to finance for young innovative firms Developing digital government Relevant skills are needed to foster innovation in the digital era The education system needs to remain attuned to changing skills needs Ensuring strong foundational skills for school and VET students Fostering skills for knowledge-driven innovation Encouraging participation in adult learning programmes Enhancing knowledge transfer to strengthen inovation Despite achievements, business-university collaboration remains weak Policy levers for strengthening business-research collaboration The transfer of public sector knowledge is improving References 3 Addressing climate change Iceland’s impact on the world climate The government’s climate policies Pricing carbon can help reach climate targets in a cost-efficient manner Designing Iceland’s carbon pricing path Investing in green capital Reducing carbon emissions abroad Border carbon adjustment Improving environmental regulation Easing the transition towards a low-carbon economy The impact on productivity and employment is likely small Increasing openness could ease the green transition Fostering green jobs and skills is key Garnering political support for low-carbon policies Low-carbon policies in individual sectors Energy generation Fisheries and port infrastructure Land transport Agriculture Industry References