Denmark Economy Facts
Denmark is one of the richest countries in the world measured in gross domestic product (GDP) per inhabitant and has the world’s highest tax burden (around 50 percent of GDP). As the Danish domestic market is small and the country lacks most of the raw materials needed by the industry, the economy is largely based on foreign trade, well-educated labor, a flexible labor market and an efficient physical and administrative infrastructure that makes it attractive to live and invest in Denmark.
The economy is dominated by private and public services. Then comes a modern and well-developed industry. The traditional main agricultural sector now contributes only a percentage of GDP.
- Countryaah.com: Major imports by Denmark, covering a full list of top products imported by the country and trade value for each product category.
After the unfavorable economic development of the 1970s with low growth, high unemployment, high inflation, growing budget deficits and rising foreign debt, the bourgeois government under Poul Schlüter 1982-1993 reversed the development with the help of a good international economy and a tight fiscal and monetary policy. The value of the Danish krone was tied to the stable German D-land, income and corporate taxes were lowered and government expenditure was reduced. Production and exports increased, inflation fell and the krona’s value rose.
When the Social Democrat-led government under Poul Nyrup Rasmussen took office in 1993, unemployment was still high. Initially, the government stimulated public and private consumption, but then continued to pursue a strict economic policy. The subsequent governments, both Venstre-led and Social Democratic, continued along the same lines.
- Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including DMK which represents the country of Denmark. Check findjobdescriptions to learn more about Denmark.
After the turn of the millennium, growth was low but steady, inflation relatively moderate and unemployment low. But in 2008 and 2009, the economy was hit by the international financial crisis and GDP declined by almost 6 percent compared to 2007. After that, growth averaged a humble 0.8 percent per year, and only in 2016 was GDP back at the 2007 level.
The state does not want and the municipalities are not allowed to run businesses. However, there are a number of former state-owned companies that have formally become limited companies, but with the state as shareholders, not least the energy giant DONG (Dansk Olie og Naturgas) and DSB (De Danske Statsbaner). The state telecommunications company Tele Danmark (now TDC) was privatized in 1998. The Danish state sold a quarter of Post Danmark in 2005 and in 2009 Post Danmark merged with Swedish Posten AB and formed Postnord.
The bourgeois parties and the Social Democrats agree that Denmark should join the EU currency union EMU and replace the Danish krone with the euro, but there is no popular support for such a measure. However, Denmark has tied the value of the krona so tightly to the euro that in practice it is a kind of EMU member but without voting rights.
At the beginning of 2015, the Danish central bank was forced to lower the key rate four times in three weeks in order to try to lower the value of the krona in relation to the euro which has weakened for a longer period.
FACTS – FINANCE
GDP per person
US $ 60,726 (2018)
US $ 352,058 million (2018)
1.5 percent (2018)
Agriculture’s share of GDP
1.0 percent (2018)
Manufacturing industry’s share of GDP
12.6 percent (2018)
The service sector’s share of GDP
65.0 percent (2018)
1.3 percent (2019)
Government debt’s share of GDP
34.3 percent (2018)
Fewer permanent residence permits
New statistics show that the number of people who have been granted permanent residence permits in Denmark has decreased from 1,795 during the period January to September 2010 to 525 in the corresponding period 2011, despite the fact that the applications were almost as many. One reason for the reduction is assumed to be the increased requirements for obtaining a permanent residence permit, such as knowledge of Danish, a job and that the applicant should be active in the associate life.
Denmark gets its first female prime minister
Social Democratic leader Helle Thorning-Schmidt is appointed new Prime Minister. Her government consists of eleven Social Democratic Ministers and six Ministers from each Radical Left and Socialist People’s Party. New Foreign Minister becomes Socialist People’s Party leader Villy Søvndal and new Finance Minister becomes Social Democrat Bjarne Corydon. Radical Left leader Margrete Vestager becomes Minister of Finance and Home Affairs. The three parties constitute a minority government, but are supported by the left party Enhedslisten and three members of parliament from the Faroe Islands and Greenland. One of the government’s first decisions is to lift the stricter border controls against Sweden and Germany.
The election leads to a shift in power
The leftist opposition wins the election to the parliament and sets the point for ten years of bourgeois rule. The left bloc gets 92 seats against 87 seats for the bourgeois parties. Social democracy, however, makes its worst choice in a long time, while the big winners are the Enhedslisten and the Radical left. The Social Liberal Left remains the largest party in the parliament.
Elections will be held in September
When the government fails to get the Danish People’s Party’s support for a growth package, Løkke Rasmussen announces the parliamentary elections until September 15.
Decision on increased border control
As a condition for its support for a number of budget savings over the next few years, the Danish People’s Party will have the government agree to increased border control against Sweden and Germany. The Danish decision is criticized by EU Commissioner Cecilia Malmström, who explains that the EU does not see sufficient reasons for the stricter border control, which according to critics is contrary to the Schengen agreement.
The new integration minister ends up in windy weather
Minister of Integration Pind receives sharp criticism from the left opposition when he calls the human rights commissioner, the Swedish Thomas Hammarberg, in the Council of Europe the idiot. Hammarberg has criticized Denmark and other EU countries for not taking responsibility for the North Africans who moved to Italy. Pind has been annoyed by Hammarberg saying that the governments of these countries fear reactions from right-wing parties.
Ministerial resignation following criticism against handling of Palestinians
Minister of Integration Birthe Rønn Hornbech is forced to resign after harsh criticism against stateless Palestinians born in Denmark being denied citizenship applications in violation of UN conventions. The resignation of the minister is a setback for Prime Minister Løkke Rasmussen, who is criticized by the opposition for delaying the decision on Rønn Hornbech’s departure. New Minister of Integration becomes Søren Pind from Venstre.
HD: “The state has power over Christiania”
The country’s highest court ruled that the state has power over the Christiania sanctuary in Copenhagen. The result comes after a seven-year legal process, in which the inhabitants of Christiania tried to get support for their disobedience to the laws of society. They have long refused to pay rent and municipal fees, and drugs have been sold openly in the sanctuary. Following the court’s ruling, the authorities say that no excavators should be deployed, but that law and order should be established.
Espersen resigns as party leader
Foreign Minister Lene Espersen leaves the post of leader of the Conservative People’s Party since opinion figures have dropped and dissatisfaction with her has increased. However, Espersen remains as foreign minister.