No people is as closely related to the Icelanders as the people of the Faroe Islands. The culture, history and language of the two nations are intertwined and their friendship is firm and longstanding.
The Faroe Islands have long been an important market for Icelandic goods counting for 3.4 billion kronur in 2008.
The Faroe Islands, with a population of just under fifty thousand people, are a market which is both interesting and of a convenient size for Icelandic companies. Communications between the two countries are excellent in the air and on sea. The flying time is just over one hour. There is considerable tourism and it has been growing in recent years, in particular from the Faroes to Iceland.
The export of services to the Faroes is still relatively small, except as regards services related to fisheries and construction.
In the last three years the relationship has been greatly enhanced with the socalled Hoyvík-agreement on free trade and the opening of the Consulate General of Iceland in Tórshavn and the Representation of the Faroes in Reykjavík.
In the Hoyvík-agreement it is stated that both sides intend to increase and strengthen cooperation in the fields of culture, energy, environment, communication, tourism and health.