The Danish Economy: An overview. Danish GDP. Danish krone exchange rate

2024 Author: Henry Conors | [email protected]. Last modified: 2024-02-12 02:54

A small country in northern Europe is the main member of the Commonwe alth. The Kingdom of Denmark also includes two small territories - the Faroe Islands and Greenland. The Danish economy is one of the most highly developed and stable in the European Union. Features a balanced state budget and low inflation.

General information

Denmark is the southernmost of the Scandinavian countries, bordering Sweden in the northeast, Norway in the north, and sharing a common border with Germany in the south. The country is washed by two seas - the B altic and the North. It is located on the Jutland Peninsula and includes 409 islands, which are united in the Danish archipelago. The territory of the country covers an area of 43,094 sq. km, is in 130th place among countries in the world in this indicator. Denmark is a typical maritime country, there is not a single point in it that would be further from the sea than 60 km. The only land border with Germany is only 68 km long.

The capital of the country is Copenhagen,founded in 1167. The city is home to 1.34 million people, including suburban residents. There are several other cities with a population of about 100 thousand people - Aarhus, Odense and Aalborg. A small, open economy highly dependent on foreign trade, the Danish economy is therefore heavily influenced by global market conditions. There are practically no natural resources on the territory of the state. There are deposits of peat, clay and limestone. Since 1970, oil production has been carried out on the shelf of the North Sea and the development of natural gas fields has begun.

Political structure

The country is governed on the principles of a constitutional monarchy, the head of state is the monarch (currently Queen Margrethe II), who performs mainly representative functions. The Queen represents the legislative branch together with the Folketing, a unicameral parliament.

The Danish state, once the homeland of the Vikings, and then a great northern European power, has now turned into a modern, prosperous small country that actively participates in European political and economic cooperation. He is one of the founders of the North Atlantic bloc, in which he has been a member since 1949. In the same year, she joined the Organization for Economic Cooperation and Development, which later became the European Union. Although the Danish economy is fully integrated into the European one, the country has not entered into a monetary and economic union, and has its own firm positions on some other issues.

Population

The country is home to approximately 5.69 million people, mostly of Scandinavian origin. Small groups are represented by Inuit (Greenland Eskimos), Faroese, Germans, and Frisians. Immigrants from various Asian and African countries make up approximately 6.2% of the population. Due to the high level of development and stability of the Danish economy, life expectancy is quite high: for men - 78 years, for women - 86 years. There are more than 2 million families and 1 million students in the country. Out of 100 families, 55 have their own homes.

Most citizens speak Danish. Although in a small area on the border with Germany, German is an additional language. A significant part of the Danes knows English well, especially residents of large cities and young people. Along with a good level of education, knowledge of languages makes the country's labor force highly competitive in Europe.

The quality of life is on average among Western European countries, with a fairly low stratification of the population in terms of we alth. Many experts call Denmark one of the most expensive countries in Europe. Living in it costs 41% more than the EU average. In terms of GDP ($57,070.3) per capita, it ranks ninth in the world.

Economic Review

The modern market economy of the country is characterized by a developed industry, with leading global corporations in the pharmaceutical, shipping and renewable energy industries. Small high-tech agriculture in Denmarkhas significant export potential. The country's post-industrial economy has a dominant position in terms of contribution to GDP at 71%, followed by industry - 26%, agriculture - 3%. The service sector employs 79% of the population, industry - 17% and agriculture - 4%.

The country is part of the EU, but not the eurozone, and has retained its national currency. The average annual rate of the Danish krone, according to the Central Bank of Russia, amounted to 9.9262 rubles per DKK. The country's government uses a wide range of tools to liberalize trade, stimulate production, and especially for a fair distribution of income. Denmark's GDP in 2017 reached 314.27 billion US dollars and ranked 36th in the world list.

Key characteristics of the economy

Denmark's economy has been growing at a relatively slow pace in recent years. In 2015, it increased by 1.6%, in 2016 - by 2%, in 2017 - by 2.1%. Growth is expected to moderate slightly in 2018.

The country has a low unemployment rate in 2017 - 5.5% according to the National Labor Survey. At the same time, the situation on the labor market was somewhat tense. Employers faced some difficulties in finding workers with the necessary qualifications. Some vacancies at the enterprises were not closed. The national government offers many programs to improve the skills of the unemployed in industries that require skilled workers.

The country also benefits: low inflation at 2.4%, large surplusbalance of payments, strong and high-tech production, hydrocarbon reserves. Negative factors are: high taxes, declining competitiveness due to high wages and a strong Danish krone.

Financial system

For a long time the country managed to maintain a state budget surplus, in 2008, due to the global financial crisis, the budget balance was in the red. Since 2014, the budget has been balancing between a surplus and a deficit. In 2017, the state budget was formed with a surplus of 1%. For the coming years, the government is planning a deficit of 0.7%.

The main problem for the country remains the need to increase state and municipal spending on housing in 2018. Measures are being taken to reduce public debt in 2018 to 35.6% of the country's GDP and in 2019 to 34.8% in 2019. The National Bank of Denmark is responsible for this and monetary policy.

Industry

The main industrial capacities are concentrated in the western regions of the country and on the island of Funen, about 60% of the industry's products are exported. About a quarter of sales volume is machine-building products. Danish companies are world leaders in many industries, including wind turbines, refrigeration equipment, wireless telecommunications equipment, hearing aids, electronic products and more.

Shipbuilding has long been one of the country's key industries, butits share in the world market is gradually decreasing. In recent years, shipbuilding enterprises have been working mainly for local shipping companies. For example, the world's largest container shipping operator and the world's third largest port operator, A. P. Moller-Maersk Group owns a shipyard where it builds container ships. It was on it that the world's largest container ship Emma Mærsk was built in 2006.

Energy and petrochemistry

The country is the only EU member that is fully self-sufficient in energy. Denmark is a leader in the use of renewable energy sources, including bio-, wind- and solar. Since 2011, it has ranked first in the world in terms of income from the use of renewable energy sources in the country's GDP.

Since the beginning of the 70s, Denmark has been developing hydrocarbon deposits on the shelf of the North Sea (19 deposits in total). A significant part of the produced oil and gas is used domestically for the production of energy and various products of the chemical industry. The largest Danish enterprises produce mineral fertilizers, chemicals, heat-insulating and heat-resistant materials.

Agriculture and forestry

The most frequently promoted visual image of the country, which is actively supported by the government, is organic agriculture. For a long time, the industry has been the driver of the economy. Denmark's agriculture employs 120,000 people (5% of the working population). High-tech and intensive agricultural production still provides up to a third of the country's exports. Denmark dominates the global bacon market (70%), is second in canned meat (21%), fourth in butter (12%), and is well positioned in the cheese and fish markets. One of the largest companies in the country and the world is Carlsberg Bruggierne og Tuborg Bruggierne, which produces famous beers.

Now the timber industry in Denmark accounts for 10% of all employment in the country. The vast majority of enterprises in the industry are, in fact, small workshops with 5-10 employees. Since the 17th century, furniture has become the country's largest export item. The bulk of the wood for the industry is imported from the B altic countries, Sweden, Finland, Poland.

International trade - imports

The government strongly supports measures to further liberalize foreign trade. Denmark has had a positive balance of payments for a long time, being a net exporter of agricultural products, oil and gas. At the same time, it is highly dependent on imports of raw materials and components for its manufacturing sector. The country ranks first in the world in terms of foreign trade turnover per capita.

Denmark maintains trade relations with almost all countries of the world. The country's industry is largely focused on imported raw materials, since it has practically no natural resources of its own. Most of all products are imported from Germany, Sweden, the Netherlands and China. The main purchased products are machines andequipment, raw materials and semi-finished products for industry, chemicals, consumer goods. According to the data of 2017, products are imported from Russia to Denmark for 2,948 thousand US dollars per year. The main part is made up of mineral products - almost 80%, followed by metals (17.7%), wood and pulp and paper products (about 5%).

International trade - exports

Exports of goods and services account for approximately 50% of GDP. Key export items: wind turbines and wind turbines, pharmaceutical products, machinery and tools, meat and meat products, dairy products, fish, furniture.

The main trading partner is the European Union (the main partners in the EU are Germany, Sweden and the UK), where up to 67% of Danish goods are sold. The next largest trading partner is the US, which accounts for about 5% of exports. Industrial equipment, products of the chemical, furniture, pharmaceutical and food industries are sold to this country. The volume of exports of goods from Denmark to Russia is insignificant, in 2017 it amounted to only 925.5 million US dollars. Industrial and chemical products make up the bulk, followed by agricultural products.