Falkland Islands millionaires reap the war dividend

They are famous for being worthless, windswept islands populated only by a few penniless farmers. But 20 years after Britain fought Argentina to liberate the Falklands, the islands have become far richer than Britain or any of its other overseas territories.

The Falkland Islands' economy has grown so rapidly that its government and many of the islanders now have more money than they know what to do with, with islanders admitting that they have a 'bonanza mentality'. On average, the islanders are a third richer than UK citizens, and there are at least six millionaires, almost twice as many per head as in the UK.

The islands have more cars than people - the population is 2,300 and there are 1,200 4x4s alone. Other cars include a Rolls-Royce, a Porsche and Jaguar.

More people in the Falklands have access to the internet than in Britain. There is a major house-building programme, with some homes costing up to £500,000.

Before Argentina invaded the Falklands on 2 April, 1982, the islands had no industry other than sheep-farming and had become severely impoverished by falling wool prices and mass emigration.

The economy has grown more than tenfold since the war and the islanders now have an average income of more than £21,000, compared with £16,000 in the UK.

The rapid influx of money comes from selling squid fishing licences in its territorial waters, with many fishing companies also springing up. The richest man on the island is thought to be Stuart Wallace, who co-owns the fishing company Fortuna. It has five boats employing 170 people. Wallace also owns prime property in the capital, Stanley, and a chain of convenience stores. 'We're not all as high as kites; we're not all spoilt rotten. From where we've come from, we haven't done half bad,' he said.

The islands are also getting growing revenue from other sources, such as tourism, with 30,000 short-term visitors last year stopping off on Antarctic cruises.

Tim Miller set up Stanley Growers, which produces everything from lettuces and aubergines to red and yellow peppers, exporting half the produce across the world. 'The population is growing and getting more affluent,' he said.

The government earns so much money from selling fishing licences that it has no national debt, and has built up national savings of more than £80m.

The government gives some of the money back to the people to pay for foreign holidays, and all the accommodation and tuition costs of going to school or university overseas.

The islands are now economically independent of the UK, except for defence costs. Keeping about 2,000 soldiers on the islands costs the British taxpayer £70m a year, towards which the island makes no contribution.