Copenhagen’s picturesque Nyhavn was a commercial port in the 17th century ©Getty Images
Copenhagen’s picturesque Nyhavn was a commercial port in the 17th century ©Getty Images

Country spotlight: Denmark

POPULATION 5.77m

AREA 42,924 km² (2,210,579 km² including Greenland and the Faroes)

THE HELICOPTER VIEW With its 400+ islands – around 70 of which are inhabited – Denmark is regularly found in the top 10 rankings for financial, social and wellbeing and in the top 20 for GDP per capita. It has also been named the world’s third happiest country.

ECONOMIC OUTLOOK Real GDP growth is forecast at 1.7% this year, slowing to 1.6% in 2020 due to weakening growth in Denmark’s main export markets. The UK accounts for 6% of exports, so Brexit is a concern. Domestic consumption will become the main growth driver.

BIGGEST INVESTORS The level of FDI is below the country’s potential, with the influx falling to -$3,115m in 2017 (World Investment Report 2018, UNCTAD). FDI stocks are mainly European – Sweden, Luxembourg, the Netherlands, UK and Norway – and the US. 

SUPPLY CHAIN ISSUES Machinery, mineral fuels, medical apparatus and furniture are popular exports, together with bacon, fish and dairy. It imports vehicles, electronics, pharmaceutical products and plastics.

STRENGTHS Denmark’s business environment is regarded as one of the world’s most attractive, with a sound macroeconomic framework, excellent infrastructure and an educated labour market. Trade policies are aimed at encouraging foreign investment. 

CHALLENGES Labour shortages are expected to intensify and result in faster wage growth and a pick-up in inflation.

BOTTOM LINE In a small country with few natural resources, innovation is key to building wealth. Strong domestic demand is expected to bolster imports. 

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