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Economy

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The economy is dominated by fishing and sheep farming. The poor land quality does not allow for large-scale crop farming. Sheep farming productivity has increased significantly since the mid 1980s. While the economy of the Falkland Islands was previously based soley on agriculture such as sheep farming, today fishing makes up the bulk of economic activity. The fishing industry has grown substantially since 1982 and was assisted by the introduction of a licensing system in Falklands territorial waters. The large quantities of squid found here has fuelled an economic bom and the beginning of what’s called “squidocracy,” which is a group of individuals living on the Falklands who have become extremely wealthy. Some are concerned about stock depletion and controls have now been introduced. The search for oil and gas reserves began in 1995; test drilling began in 1998, but no substantial deposits have been found. Despite improved relations with Argentina, trade between the islands and the mainland is small and most trade is still conducted with Britain.

Now agriculture mainly supports domestic consumption with the exception of high-grade wool, which is exported. The British military presence also contributes to the economy considerably. Tourism is encouraged and is increasing rapidly on the islands with about 30,000 visitors in 2001. Many of these come from visiting cruise ships and most of the tourists are from the UK.

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