Denmark

Capital: Copenhagen

Local time:
It is %T:%M %A in Copenhagen

GDP growth rate: 1.7% in 2013

FDI stock: 139 205 million USD in 2010

Economic trends

The country was strongly hit by the financial crisis, due to its high degree of openness to international trade and to the high level of financialization of its economy. However, profiting from the resumption of trade, Denmark has experienced a more dynamic economic recovery than its European neighbors. GDP growth is estimated at 2% in 2010.

Fiscal and social measures adopted by the government in order to mitigate the effects of the crisis have destabilized public finances. Government’s priority in 2011, which was defined as part of a consolidation plan, is to lower the budget deficit by decreasing spending and increasing revenue.

Structural reforms are also planned. Denmark's economy suffers from relatively low productivity. The costs of employment are high but the number of working hours is low and there are many active adults receiving income benefits. The goal has been therefore to promote the human capital and encourage late retirement. Faced with the depletion of its petrol and natural gas reserves, the country has also set itself ambitious goals in terms of its energetic policy.

Denmark is a wealthy country, its per capita GDP figures among the highest in the world and its social inequalities are small. Although the unemployment rate remains low on European scale, it has clearly increased following the economic recession.

Main branches of industry

The agricultural sector only accounts for 1.3% of the GDP and employs merely 2.7% of the population. Nevertheless, Denmark has become one of the major exporters of agricultural products. Two-thirds of its agricultural production are exported. Most of the Danish land is used for agriculture and there are more than 50,000 farmers in Denmark. Nearly 90% of the country's agricultural revenue comes from livestock production.

Denmark has limited natural resources, a fact which slows down the development of its heavy industry. However, the country has enough oil and gas reserves to ensure its energy freedom. Denmark is the world's leading manufacturer of wind turbines and exports 85% of its production. The major activity sectors are: chemical and pharmaceutical, biotechnology and services (approximately three-fourths of the GDP).

The services sector contributes nearly three-fourths of the GDP and provides most employment.

International trade

Historically a nation of traders, Denmark's economy is extremely open to the outside. Trade represents more than 100 of the GDP.

The trade balance is structurally positive, a tendency which was only strengthened by the combined effects of a decrease in imports linked to a lower domestic demand and the recovery of internation trade. 

Denmark's main trade partners are Germany, Sweden, the Netherlands, UK, USA and China.