Sky-high prices on Iceland's High Street Skip to content

Sky-high prices on Iceland’s High Street

By Iceland Review

The EU agency Eurostat has just released a study of prices for clothing and shoes in the countries of the EU 25, the three EFTA countries (Iceland, Norway and Switzerland), and three EU-candidate countries.

Iceland comes in at the top of the list and scores a hefty 149 on a clothing and shoe price index compared to an average score of 100 for the countries polled. The survey included 285 separate clothing and footware products and was conducted in 2003.

Citing his own intuition, Andrés Jónsson of the Federation of Icelandic Trade is quoted on Iceland State Radio saying that competition has forced prices lower since the survey took place.

The president of Consumer’s Association of Iceland, Jóhannes Gunnarsson, claims in Fréttablaðið that the high prices reflect the high margins charged by importers.

Fréttablaðið also quoted a representative of the Federation of Trade and Services. He said he was unable to identify any single reason for the high prices in Iceland but speculated that high transport costs could be one contributing factor.

The Icelandic retail sector is quite consolidated, a handful of companies control the bulk of the trade.

The Icelandic parliament, Alþingi, passed a controversial new competition law just before recess this spring, the opposition parties claiming that the new legislation would weaken the competitive environment, the government parties claiming that the new law would strengthen it.

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