Iceland

The Republic of Iceland, considered to be a part of Europe, is located in the North Atlantic Ocean. It is the second largest island in Europe and the 18^th largest worldwide, but just 25% larger than Ireland.

Island is a very young country, and the formation processes are still going on. Because of its situation on the Mid Atlantic Ridge it is the focus for volcanic and geothermal activity.

The country is characterized by desert plateaus covering 52% of its surface, by lava fields, which cover 11% and 4% sand deltas also called sandur. Over 11% of the country is covered by glaciers, including Vatnajökull, the largest glacier in Europe.

Only 21% of Icelands landmass is considered arable and habitable which forces the main part of the population to concentrate in the Southwest between Reykjavík and Vík. Iceland counts 4,970 km coastline with 758,000 sq km sea area within fishing limits.

Iceland's highest peak is the Hvannadalshnukur with 2,119 metres (6,950 feet). Although Mid Atlantic, Iceland is on Greenwich Mean Time.

Iceland's location is perfect to attract European visitors as well as North American and Canadian tourists, which are huge market with high travel demand and disposable income and time.

Climate

Iceland enjoys a cool tempered ocean climate with cool summers but fairy mild winters. It is mainly affected by the warm and humid air currents from the southwest, the warm waters of the Gulf Stream and the cold air coming from the Arctic. Also the local effects of the ice-caps influence the climate. The unfortunate side of this combination is rain and the weather is extremely changeable. It's the sunniest in the North, but there is a steady wind, which makes even warm temperatures feel chilly.

In Reykjavik, average temperatures are approximately 11°C in summer and 0°C in winter. The city enjoys in average 3 sunny days a year.

The main tourist season lays in the months July and August, which are generally the warmest months, although May and June are drier than the peak months but colder.

From the end of May to the beginning of August, there are nearly 24 hours of daylight in Reykjavik, while in the northern part the sun does not set at all. The Northern Lights appears from the end of August.

Although the weather is not warm and sunny and that is why wont attract the typical beach holiday package tourist, it may attract individual tourists, also called "The New Tourists", who wants more than a typical package holiday at the beach. The weather suits to Iceland's rough landscape and can make adventure and nature tours even more exiting.

2. The regions

Reykjavík and the capital area

Reyklavík is the world's most northern national capital located in the southwest of Iceland and is the heart of Iceland's economic and governmental activity.

Today, Reykjavík is the centre of the Greater Reykjavík Area which, with a population of 200,000, is the only metropolitan area in Iceland. As a highly modernised capital of one of the most developed countries in the world, its inhabitants enjoy a first-class welfare system and city infrastructure, from which tourists benefit, too.

Reykjavik has something to offer for every visitor with its theatres, concerts, art galleries coffee houses, restaurants and shopping centres. Tourists can visit one of the city's geothermal pools and baths or its nightlife and entertainment venues as well as festivals like the Reykjavík Arts Festival.

The Southwest and the South of Iceland

Because this region, the Reykjanes peninsula and Tingvellir, lays exactly on the junction between the European and American tec-tonic plates visitors can see active volcanoes or high-temperature geothermal areas with geothermal power stations for electricity.

A visit worth it is the famous Blue Lagoon Spa, which hot and mineral-rich waters are known for their curative powers.

Because the population lived by fisheries, several museums uphold the region's seafaring traditions but also the traditional sagas and legends of the country are told by the museums like the Icelandic Saga Centre in Hvolsvöllur or the Ghost Centre at Stokkseyri.

Also Iceland's most historic site Tingvellir as well as the Nationalpark Tingvellir are situated in the area.

Other attractions of the regions are places of outstanding natural beauty including magnificent waterfalls like the most popular the Gullfoss, many geothermal areas villages grew up, hot springs (Geysir) and active volcanoes like the Mount Hekla.

The area can be explored via horseback-riding, rafting and glacier trips.

There are a number of daytrips organized from the capital.

Just off the south coast are also the Westman Islands with their interesting history, natural beauty and various birds

West Iceland and the Westfjords

To visit the Westfjords one must go via West Iceland either by road or ferry. The Snæfellsjökull glacier is the main attraction, as well as lava formations and geothermal activity. There are fishing villages, bird cliffs and hiking trails to discover The area that includes the glacier is Iceland's newest national park. The West Fjords are the most sparsely populated area of Iceland.

The North of Iceland

Northern Iceland contains a great variety of scenery with rich farmland, mountains and endless rugged coastline. This part of Iceland is famous for its continous daylight. The main purpose of the regional economy is farming and breeding horses, although there are a few fishing villages.

Akkureyri is the capital of northern Iceland and is the 3^rd largest town in the country with shipyards, factories, important transport links and good shopping opportunities. The town has an excellent Botanic Garden and a pittoresque historic part. The town Husavík at the coast is base for whale-watching and in the east lays the Jökulsargljufur Notaional Park and Europe's most powerful waterfall the Dettifoss. The most popular attraction for ornithologists is the lake Myvatn.

The East and Southeast of Iceland

This is Iceland's most geological stabile region and one of its biggest attractions is the chance of sunshine but also boasts with the countries largest forrest and longest lake, fine waterfalls. Individual tourists may appreciate the lack of well structured and organized tourism.

The Southeast is dominated by Europe's largest glacier the Vatnajökull, which can be discovered by ski or foot. But also the most destructive volcanoes lay here, which caused famines and destructions in the late 18^th century. The eruptions cause glacial melting and dangerous floods (the last 1996), this phenomena lead into the sandur, big desserts, chracterised by sandy plains, long and empty beaches, shallow lagoons and barrier islands. The region also has a National Park the Skaftafell, which includes Iceland's highest peak the Hvannadalshnukur.

The Highlands

The Highlands in the center of Iceland are mostly uninhabited and is one of the main areas for 'safari' type of tours. The main attractions include the western route over Kjolur, Langjökull glacier and the Hveravellir geothermal field. Other regional highlights are the area around Mt Askja, with the geothermally heated Lake Viti, Kverkfjoll on the rim of Vatnajökull and the springs at Landmannalaugur. A favourite for hikers is the Thorsmörk nature reserve.

3. Attractions

Nature, action, wellness, culture and heritage tourism are the main attractions in Iceland.

Nature

Iceland is one of Europe's last great wilderness areas. It has one of the greatest variety of scenery with dramatic landscape and natural phenomena like mountains, glaciers, fjords, geysers, lakes, rivers, waterfalls, lagoons, hot springs, lava landscapes and beautiful coastal scenery. In summer, there are trips to watch the midnight sun, and, from the end of autumn to view the Northern Lights. The two main nature-watching trips are bird-watching (March-October) and whale-watching (May-September). Millions of seabirds are breeding along the coastline and rare species like owls, whimbrels and ptarmigan can be watched in the moorlands. The country has been in the focus of interest for ornithologists for decades especially the area around Mývatn. Whale-watching

The foremost whale-watching venue in Iceland is Húsavík with almost garanty to see whales. There is a big variety of whales which can be seen such as Minke whales (seen in 1996 on 93% of the trips), Blue whales, Humpback whales (seen in 1996 on 63% of the trips), Orcas, White-beaked dolphins, Atlantic White-sided dolphins and porpoises. But there are less and less whales to be seen due to an announcement in 2003 of the government planning to kill 100 Minke whales, 100 Fin whales, and 50 Sei whales for research over two years. By July 2004, it had killed 61.

In April 2003, the Icelandic Tourist Industry Association and conservationists stated that the government plans would cause great damage to the Icelandic tourist industry and that whale-watching would be more lucrative than any resumption of whaling could be. According to the International Fund of Animal Welfare Iceland's whale-watching industry earned over US$6 million in 1998, 2 million more than the resumption of whaling from 1985 to 1989 The numbers of whale-watchers has risen from 30,330 in 1998 to almost 44,000 in 2000. One out of every eight visitors goes whale-watching. National parks

There are four national parks: Jökulsargljufur at the waterfalls, Skaftafell in the south at the Skaftafellsjökull glacier, Snæfellsjökull in the west with the Snæfell mountain and Thingvellir, just east of Reykjavik which got the World Heritage status in 2004.

Thingvellir National Park habitates the largest natural lake of the country and the river Sog, the longest spring fed river of the country with three hydro electric power stations situated on the river, which counts among the good salmon rivers.
The natural surroundings are majestic and the contrasts are great. There is a system of hiking trails all over the park. The present natural landscape has been in creation for about 9000 years and is still being created by the plate tectonics. The lake contains at least four species of trout and char and angling is popular. The lake is run by local farmers, who sell the fish to domestic and foreign markets. The distance from the capital is 49 km.

National Park Skaftafell with its rugged landscapes, mountains and glaciers has no roads, but a network hiking trails. It offers large camping grounds, toilets, washing machines, a restaurant, a shop and a petrol station. Walking tours are available and guided. The distance from the capital is about 340 km.

The National Park Jokulsargljufur covers 150 km² and a 35 km long stretch along the western side of the glacial river Jokulsa. The river canyons are about 25 km long and resemble the Grand Canyons in Arizona.
There are several places of exceptional natural beauty in the park, such as the Asbyrgi Canyon, the Whispering Cliffs or the mighty Dettifoss Waterfall.

The Snaefellsjokull, the 4^th National Park was established on the 28^th of June 2001. Its boundaries follow the eastern border of the Gufuskalar estate on the northern part of the peninsula, along the east side of the glacier and along the eastern edge of the Haahraun lava.

Vatnajolull National Park will probably be established in the early 2008. Its area is estimated 15,000 square kilometres, which makes it the largest one in Europe.

But there are also 59 other nature reservates like nature parks, natural monuments and wildlife reserves. Action and wellness

Iceland natural characteristics in terms of its challenging climate, wild and dramatic as well as scenic landscape combined with the geothermal energy gives visitors the perfect conditions for outdoor activity and spa packages. Activities range from angling, swimming, walking and visiting the outdoor geothermal swimming pools, to more adventurous trekking, glacier exploration, horse riding, mountain biking, river rafting, kayaking and four-wheel driving. There are also winter sports such as skiing and snow-mobiling, which are available even in summer on the glaciers.

Culture and heritage

The culture of Iceland is rich and varied as well as being known for its literary heritage. Other Icelandic traditional arts include weaving, silver crafting, and wood carving. The Reykjavík area has several professional theatres, a symphony orchestra, an opera, and a large amount of art galleries, bookstores, cinemas, and museums as well as a vibrant nightlife.

Mostly private local museums can be found all around the country. As well as various events and celebrations, including music, film and arts festivals, and exhibitions on Vikings, sagas and folklore. Examples include the Viking Festival in Hafnarfjordur, the Reykjavik Marathon (every August), National Day (17 June) and a variety of other local events.

Most of the Iceland's heritage in forms of ancient buildings got lost because of the forces of nature and many Icelandic got killed by eruptions, plagues, crop failures and centuries of foreign domination. But Iceland still retains a strong connection with its past and the inhabitants are proud to have fought and resist against both: nature and foreign domination as well as managed to exploit the sea's rich harvest to have today one of the highest standards of living in the world. This national pride is the reason for that the ancient language of the Vikings is still spoken.

4. Tourism and the Economy

Tourism is an important source of foreign revenue and the number of tourists visiting Iceland is steadily increasing but the industry has not really been able to keep abreast of it. Tourism provides almost 7000 jobs with a forecasted increase up to 6,9 % or 12,113 jobs until 2014.

Tourism in Iceland accounts for 5.1% of Iceland's GDP. It is estimated that a 130,000 foreigners visited Iceland in 1987 and the number doubled in the following two years. Receipts from foreign visitors increased 29.2% over a four year period between the years 2000 and 2004 to IKR 39.4 billion. The revenue just in 2000 was 30.5 billion krónur, or 13.3% of exported goods and services (2^nd place after fisheries industry), which is a 45% increase from 1995.

The tourism in Iceland is without a doubt a growing industry. It has grown enormously in the past few years and looks as if it will continue to grow in coming years. 3,6% growth are expected until 2014 per annum.

Each traveler spent almost IKR 110.000 in Iceland on average. In 2002 the average spent was €949. Figure 6 shows international tourism receipts from 1992 to 2003. The foreign capital investment on tourism in Iceland accounted for 18% of the total investment in 2004, which are US$ 452 million (WTTC cited by Mintel).

5. Arrivals and Nationalities

Foreign visitor arrivals

Iceland's number of tourist arrivals over the last decade had an annual increase of 7.2%. The largest group of visitors, 356,200 arrived by air through Keflavik airport, 8,100 through Seydisfjord seaport and 5,000 through other airports and harbours.

Additional got 56,000 visitors on cruise ships.

In the past years Iceland was always top-ranked as 'Favourite European Country' in the Guardian and Observer Travel Awards.

The largest group of visitors to Iceland comes from Nordic countries, followed by the UK, North America and Germany. But Iceland had to face a decline of the North American market, but increased numbers of visitors from Germany and France since 2000. Iceland has also seen increased numbers of visitors from Asia-Pacific region.

Nationalities

Between 2000 and 2003 there was a 19.8% increase in the total number of arrivals at hotels and guesthouses. In particular, there was an increase in arrivals from the UK (41.6%), the Netherlands (65.3%), France (72.8%), Canada (73.1%) and Japan (76.5%). There was a decrease in the number of arrivals from Sweden (12.2%) and Finland (25.6%).Between 2000 and 2003 there was a 15.4% increase in the total number of overnight stays of visitors. In particular, there was an increase of overnight stays of visitors from the Netherlands (46.7%), France (60.9%) and Japan (95.5%). There was a decrease in the total number of overnight stays of visitors from Sweden (16.9%), Finland (20.1%) and the USA (0.1%).

6. Market Characteristics

Purpose of visit - Motivation

Most visitors are mainly interested in recreational activities connected with nature.

The most popular attraction is the Blue Lagoon, which attracts about 70% of Iceland's tourism market. Observing nature and hiking are often the most popular activities.

The main motivational factors to come to Iceland are the unique nature, which is unforgettable and scenic especially in the Highlands, the silence, which is brilliant to relax for stressed out urban visitors, the fresh and clean air as well as the hot pots and thermal pools, which give tourists the possibility of a wellness and spa stay. Also the adventures and activities, which are suitable for individual travelers as well as families and other package tour visitors and the natural wonders like the northern lights and midnight sun, which gives a stay in Iceland a memorable touch.

But even the weather can be seen as a motivational factor, the unpredictable changes between sun, wind and rain can give outdoor activities an exciting touch and fits perfectly to the rough surrounding.

Over 60% of all visitors are individual tourists motivated by the wish to explore the region by themselves and to experience a personal adventure. The high number of tour operators in Iceland, which are mainly specialists make support that demand. There are at least 73 operators offering horse riding tours, 27 various kinds of boat tours, 27 hiking tours, 26 jeep and glacier tours and ten snow-mobile expeditions. Approximately 25 operators offer day excursions.

Another purpose to visit Iceland is for business related reasons. Iceland's earnings from business tourism were estimated by the WTTC around US$554.3 million in the year 2004. It predicts that by 2014 this should reach US$900.5 million.

All major business activities take place in Reykjavik and the city came 20^th in the rankings of European meetings, with a market share of 1.2%

7. Transport

There are no public railways in Iceland, although there are plans to built a line. The principal modes of transport are car or the bus, as well as insight flights between the major cities, for example Reykjavík to Akureyri, The only way of getting in and out of the country is by air and sea.

By air

There are excellent transportation choices via Icelandair, which operates in ten countries. There are daily non-stop flights to the countries main airport Keflavik, which is located 45 minutes from Reykjavik. Many people discover Iceland by taking advantage of "stop-over" opportunities. Then they're hooked and often plan their next vacation to be solely an Icelandic one.

Iceland has another 15 gateway airports in Europe with flight times up to four hours to Western Europe and five major gateway airports in North America to Iceland and beyond form the US from Baltimore/Washington, Boston, Minneapolis, New York and Orlando with flight times between five to eight hours.

Other airlines including Air Atlanta and Iceland Express mainly operate as a charter airline on international routes. Some foreign airlines also fly to Iceland from time to time.

By sea

The positive effect when choosing a boat to get to Iceland is that you can take your own vehicle with you. In the summer, Smyril Line's MV Norrøna sails in a week round trip to picturesque Seyðisfjörður from Northern Jutland (Denmark) via Faroe Islands and Bergen (Norway).

There are also two domestic ferry companies - Ferry Baldur and Westman Islands Ferry. There are also luxury cruise liners arriving in Iceland for a stop over with the majority of German and British passengers.

Other

Iceland is small and has a well developed public transport system, but many roads in the interior of the country remain still unsurfaced. But also private companies offer organized bus tours. There are special offers for round trip bus tickets.

It is very common to bring the own car into the country when travelling by ferry to Iceland. But tourists without a car or coming by plane have the option to hire cars. Especially the four-wheel drive is a popular option giving a feeling of adventure and action holiday.

8. Outlook

Iceland built up its reputation to be an expensive but individual destination and developed its tourism potential especially among the most prized European outbound markets.

Iceland's marketing focuses on the area in and around Rejkjavik, its cultural habitat and its nature.

The countries competitive advantages are its good accessability, the high quality of its natural environment perfect for adventures, its cultural and habitat, the practiced sustainability in terms of limited capacities as well as the high quality of hospitality facilities.

Iceland is recently changed its main focus from the USA and Canada to the opening of new European markets especially in the East and South and the Asian market particularly Japan

Efforts were made to promote the country for short breaks to off-set the effects of seasonality.

The forecastings of the WTTC's Tourisms Satelite Accountings are positive (2004) and expecting a growth of 3.6% per annum between 2005 and 2014.

9. Conclusion

In general one can say that Iceland attracts a new type of tourist, who wants more than a typical package holiday with beach, sun and sea.

Tourists coming to Iceland are attracted by its unique culture and heritage, which is a combination of ancient and modern customs in one of the most developed countries but with a nearly untouched environment. Visitors are also attracted by the individualism and variety of tours offered by dozens of tour operators. Iceland's main attraction is its natural habitat with its unique national parks, the geothermal and volcanic activities and its scenic and invites for wellness and spa stays as well as activity and adventure trips. Iceland's rivers, lakes and coastline are perfect for fishing and bird and whale watchers come from all over the world into the country. Although the weather is rough as the country it suits perfectly to the environment and gives adventurers and individualists a perfect atmosphere for their visit in Iceland.

The main region for tourism is in and around the capital Rejkjavik and it is most common to make tours into the country from there. Most tours go along the ring road covering nearly all regions.

10. References

University Report by Nina Sauer

Bendure, G.; Friary, N.; Cornwallis, G.; Kokker, S.; Lucas, C. ( 2001) Scandinavian & Baltic Europe. 5^th Ed., pp. 227-268. Lonely Planet: Victoria.

Boniface, B. & Cooper, C. (2001) Worldwide Destinations: The Geography of Travel & Tourism. 3^rd Ed. Butterworth-Heinemann: Oxford.

Mintel Oxygen (2004) Country Reports - Travel and Tourism. Travel and Tourism - Iceland - August 2004

Swaney, D. & Cornwallis, G. (1997) Iceland, Greenland and the Faroe Islands. 3^rd Ed., pp. 44-351. Lonely Planet: Victoria

Williams, D. (1996) Iceland. 2^nd Ed. Essential: Hampshire.

http://en.wikipedia.org/wiki/Iceland. Iceland.

(Last accessed: 18th February 2008)

http://www.geographia.com/iceland. Iceland.

(Last accessed: 28th February 2008)