A literary tradition that was born about 900 years ago with the Sagas, which Icelandic children still read today, has evolved into a thriving modern-day appetite for crime fiction.

Publishers and authors at the Frankfurt Book Fair, which ends Sunday and where Iceland has been guest of honour, say the strength of Icelandic literature belies its size of just 320,000 inhabitants.

"Our heritage is not of industry, or great architecture, or buildings or palaces," Egill Orn Johannsson, managing director of Forlagid publishers said.

"We have text, that's our heritage. When we look upon what we have done it's to the Sagas," he said.

Widely seen as a gem in world literature, the Icelandic Sagas, which have been translated into English and German, describe events among the Norse and Celtic inhabitants of Iceland in the 10th and 11th centuries.

Written between the 12th and 14th centuries, they focus on history, especially genealogical and family history, reflecting the settlers' struggles and conflicts.

Kristjan Jonasson, of Crymogea publishers said his great-grandfather used to relate the Sagas to him as a child but now children's adaptations are available while the Sagas are also taught in school.

Today Icelandic literature can boast a host of crime writers, who over the last 15 years have placed it on the world map of police detective novels alongside their Swedish, Norwegian or Danish counterparts.

With a relatively low crime rate, authors perhaps have little to draw on, but at the end of the 1990s Icelandic authors began to emulate the style of Scandinavian crime writers, Jonasson said.

"The slow-paced, realistic, dark and even pessimistic tone of the Nordic crime fitted very well to the way Icelandic writers simply had been dealing with reality before," he said.

Initially their success was confined to Iceland but it grew into the sale of several million copies in Europe.

One of those known internationally, Yrsa Sigurdadottir, said she wrote her books with an Icelandic audience in mind first, choosing stories that are not shown in the media about society.

"Icelandics are seen as good, innocent, non-violent and even docile people, but it makes the crime stories even more fun. It's like red blood on white snow, it 'looks better'," she said.

Despite the limited size of the Icelandic market, 1,500 titles are published annually in the country and eight books are sold per capita, Jonasson said.

"Iceland is a nation which always focused on story telling. We think something has not happened as long as it hasn't been written down on paper," Icelandic President Olafur Ragnar Grimsson said through an interpreter at the fair's inauguration.

Government subsidies since the 1980s to help support about 100 authors a year is one of the reasons why Iceland's literary scene is strong today, Jonasson said.

But, historically, storytelling at the grassroots level was key.

For centuries people lived overwhelmingly in rural areas where households every night would have a reading from a book or a poem recital learned by heart.

Jonasson said there was also a democratic nature to Iceland's literature, with a sense that everybody was entitled to express themselves in words or prose, regardless of their level of education or class.

"This is the fundamental notion of what literature means in Iceland," he said.

For Johannsson, one reason may lie in more modern day history. Shortages during World War II left people in Iceland with little but they did have books which sparked a strong tendancy of giving books as gifts.

"We have managed for some reason to keep that tradition and by far the most popular Christmas gift in Iceland is the book," he said.