Well a detailed view on exactly why would take many many pages of text, but to name a few things, which are major contributors is easy.
1. Population under 50.000 and pretty secluded from the rest of the world when it comes to transport of goods both in and out of the country. This coupled with many small players in various business, rather than a few big players buying bulk, makes everything more expensive.
2. Everything gets spread out over the entire country.
For example active incentives by Faroese government to encourage growth instead of decline of inhabitants on the smaller islands, by providing various aid and jobs to the smaller islands. Transport infrastructure to most all islands worthy of a multimillion population society. Free education everywhere. By that I mean for example small schools where there are maybe 30 children and placing other e.g. colleges away from the capital. Also there are far to many regional parts rather than a few (there is work being done to reduce these to 7, which would already help). Every one of those with city officials and so forth. This creates a need for higher taxes than average. Free health care, which is great, but with 3 hospitals for 50.000 people??
3. Constant infighting over if we should cut more ties with Denmark, make more ties with Denmark or keep it as is. Pretty much 45/45/10%. this creates a constant tension.
4. Not being part of the EU
http://en.wikipedia.org/wiki/Special...#Faroe_Islands because of EU being complete and utter morons when it comes to fishing quotas etc. They fail to see that even though the Faroe Islands are small, our oceanic territory is very large
http://en.wikipedia.org/wiki/Territorial_waters ((It is 200 nautical miles, no matter what wikipedia or the EU claims) or for that matter you British people
) and even further than 200 NM
http://en.wikipedia.org/wiki/Rockall . Another reason why we do not work well together with EU
Whaling in the Faroe Islands - Wikipedia, the free encyclopedia
Lots of info here:
Faroe Islands - Wikipedia, the free encyclopedia