Private spending expected to drop

The steadily increasing living costs in the Faroes will rise even further as a result of the war in Ukraine.

Prices of food, raw materials, oil and gas have risen considerably in recent weeks, and further increases are on the horizon.

This is one of the key conclusions of the new Economy Outlook Report issued by the Ministry of Finance.

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According to the report, the uncertainty caused by the war will bring about a decline in private spending and the propensity for investing.

Faroese exports to Russia and Belarus have been affected by the war. It is believed that alternative markets will be found, but lower prices are expected, at least in the short term.

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The report adds that it will be difficult to agree on any further fisheries agreements between the Faroes and Russia.

In general, the report suggests that the high degree of uncertainty caused by the war has led to a moderately pessimistic short to medium term economic outlook for the Faroese economy.

Read the Faroese version of this article here.

More Faroese News in English.