Discusses key economic indicators and trade statistics, which countries are dominant in the market, and other issues that affect trade.
Denmark is a constitutional monarchy of 5.8 million people that shares a southern border with Germany and is connected by bridge to southern Sweden. With a total area of 43,096 km2 (16,640 mi2), Denmark (excluding Greenland and the Faroe Islands) is slightly smaller than Vermont and New Hampshire combined. The country has been a member of the European Union (EU) since 1973. The Kingdom of Denmark also includes Greenland and the Faroe Islands.
Denmark is a high-income, modern society with state-of-the-art infrastructure and distribution systems, a highly skilled labor force, and a central location that makes it an excellent distribution point for the Scandinavian, Northern European, and Baltic markets.
The economy displays a number of strengths. The “flexicurity” of labor market flexibility alongside the security of a strong social safety net helps adjust to shocks while limiting the social cost of unemployment and the risk that it could become entrenched. The social welfare system ensures low poverty and low income-inequality.
Denmark’s fiscal position is sound, and the country entered the global COVID-19 pandemic from a position of strength, highlighted by the Danish economy having a low fiscal deficit of 2.3 percent of GDP in 2021.
The Danish economy emerged relatively unscathed from the pandemic, with a shallow 2 percent recession in 2020.
Denmark now faces a potential mild contraction of GDP in 2023 due to geopolitical developments, high inflation and energy prices, and a tight labor market.
Denmark’s standard of living is among the highest in the world with a GDP per capita of $67,196 in 2021.
Denmark is a firm advocate of liberal trade and investment policies and actively encourages foreign investment.
There are more than 550 American subsidiaries established in Denmark and a strong American Chamber of Commerce with approximately 240 members.
The leading United States exports to Denmark are industrial machinery, capital equipment, computers and telecom products, software, aircraft, and scientific instruments. Other important U.S. exports to Denmark are military equipment, chemicals and pharmaceuticals, tobacco, wine, fresh vegetables, nuts, and forest products.
Imports of goods and services in Denmark from the world: (Source: Statistics Denmark)
Goods (2021) - Main Imports (% of total goods imports)
Machinery (excl. transport equipment): 24.2%
Miscellaneous Manufactured Articles: 17.8%
Live animals, food, beverages, and tobacco: 13.8%
Manufactured goods and articles: 13.6%
Services (2021) - Main imports (% of total services imports)
Sea transport: 37.7%
Telecommunications, computer and information services: 11%
Air transport: 2.8%
Imports of goods to Denmark in 2021 from the United States (Source: Statistics Denmark)
Goods - Main Imports (% of total goods imports)
Machinery (excl. transport equipment): 17.4%
Manufactured goods and articles: 19%
Live animals, food, beverages and tobacco: 7.7%
Primary goods: 4.3%
Danish exports to the United States have increased substantially, and in 2020 the United States surpassed Germany to become Denmark’s largest export market. Exports to the United States constituted 11.9 percent of total Danish exports in 2021. The key category driving this increase continues to be chemicals, as one-fourth of Danish exports from this category went to the United States.
American-owned firms play an important role in Denmark. The largest share of U.S. investments goes to the software, information, and communications sectors. American firms are also notably present in business and financial services, pharmaceuticals, and offshore oil and gas exploration and production.
Situated within the Nordic region, Denmark, like Finland, Norway, and Sweden, is an advanced, high-income, and highly connected country. While each country has its own unique market and characteristics, there are certain synergies that tie together these highly innovative marketplaces. With an aggregate GDP of 1.47 USD trillion and combined population just shy of 27 million people, the Nordics are of genuine interest to a number of U.S. companies with products, technologies, and services that are appropriate.