Market Overview

• Denmark is a constitutional monarchy of approximately 6 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 (not including 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 includes Denmark, Greenland, and the Faroe Islands.  Under the Kingdom of Denmark’s constitutional framework, the Government of Denmark retains authority over foreign, defense, and security policy for Greenland and the Faroe Islands, but Copenhagen has increasingly consulted with them on these issues, including through a regularly occurring “Contact Committee” that brings together the three prime ministers.  The Faroe Islands and Greenland have self-government responsibilities for most economic and trade related matters, including, but not limited to, taxes, duties, supplies, production, distribution, price controls, import and export controls, the labor market, natural resource management (including fisheries and minerals), energy policy, health, and education.
• As a high-income and technologically advanced society, Denmark boasts a state-of-the-art infrastructure, efficient distribution systems, and a highly skilled labor force. Its central geographic location makes it an ideal hub for distribution to the Scandinavian, Northern European, and Baltic markets.
• The Danish economy exhibits several key strengths. Its “flexicurity” model, which combines a flexible labor market with a strong social safety net, allows the economy to adapt to external shocks while mitigating the social costs and risks of unemployment. This robust social welfare system contributes to low poverty rates and minimal income inequality, further fostering economic stability.

Economic Performance and Forecast

• The Danish economy has shown remarkable resilience in recent years. After a shallow 2 percent recession in 2020 due to the pandemic, the economy rebounded strongly. In 2024, Denmark’s GDP grew by 3.7 percent, largely driven by the exceptional performance of the pharmaceutical sector. Looking ahead, the pace of growth is expected to moderate but remain positive.   Denmark’s official statistics agency recorded a real GDP growth of 2.9 percent in 2025, compared to the EU average of 1.5 percent reported by Eurostat.  However, the Danish government forecasts further easing to 1.5 percent in 2026.  The Ministry of Finance has projected the government surplus to narrow to 0.6 percent of GDP by 2026 as rising defense spending and demographic pressures reduce long-term fiscal space.  This moderation is attributed to weakening external conditions and a slight slowdown in key sectors, though the reopening of the Tyra gas field in the North Sea contributing positively to growth in 2025.
   
• The country’s economic stability is reflected in its low unemployment rate. While it saw a slight increase to 5.59 percent in 2024, it remains well below the Eurozone average. The Danish labor market is expected to remain tight, although some early signs of easing have emerged.
   
•  Denmark’s standard of living remains among the highest in the world. Its GDP per capita was recorded at approximately $71,852 in 2024 (World Bank), and reached $77,050 in 2025 (IMF).

Trade and Investment

• Denmark is a strong advocate of liberal trade and investment policies and actively encourages foreign direct investment. As a small, open economy, Denmark is highly dependent on its ability to freely exchange goods and services with other nations and trade and investment are crucial for its growth, productivity, and competitiveness. The country’s largest economic sectors include shipping, energy, life sciences, and agriculture.  Shipping is Denmark’s largest export industry and accounted for 24 percent of total exports in 2024.  The country’s strong reliance on exports and imports, with a significant portion of its GDP tied to foreign trade, reinforces its long-standing advocacy for an open, rules-based global trading system.
   
• American-owned firms play an important role in Denmark’s economy. U.S. companies own a substantial number of subsidiaries in Denmark. There are over 1,000 U.S.-controlled subsidiaries operating across the country, together employing over 40,000 people. These affiliates are active in sectors such as life sciences and pharmaceuticals (e.g., MSD/Merck, BMS, Pfizer), information technology and software services (Microsoft, IBM, Cisco), renewable energy and industrial manufacturing (GE Renewable Energy, Honeywell), and consumer goods, hospitality and logistics.
   
• In 2024, U.S. exports of goods and services to Denmark were $18 billion, up 10.9 percent from 2023, and imports from Denmark were $19.5 billion, up 0.4 percent from 2023. As a result, the trade deficit with Denmark decreased to $1.5 billion. In 2024, U.S. direct investment in Denmark reached approximately $12.3 billion, an increase of 23 percent from the previous year, while Danish investment in the United States rose to about $68.9 billion, up 18.4 percent.
   
• The trade relationship between the U.S. and Denmark is significant and currently results in a substantial trade surplus for Denmark. Based on the latest available data, the total annual two-way trade in goods and services is approximately $46.1 billion, reflecting a dynamic and growing economic partnership. This strong trade volume is characterized by high-value transactions, where the Danish economy serves as an important hub for specialized European products and high-tech services entering the U.S. market.

Danish Exports to the United States (Total approx. $30.7 billion)

• Pharmaceuticals & Life Sciences (Goods): This sector accounts for the single largest share of Danish exports, with goods totaling an estimated $20-22 billion annually. This includes specialty biotech products, finished pharmaceuticals, and advanced medical equipment, dominating the trade flow.
• Services Exports: Danish exports of services, including maritime transport, logistics, and licensing of proprietary technology, are valued at approximately $8-$10 billion.
• Industrial Machinery and Equipment: A smaller but significant portion of goods exports is made up of advanced industrial machinery, precision engineering components, and specialized wind energy technology.
• U.S. Exports to Denmark (Total approx. $15.4 billion)
• Financial and Business Services: The largest component of U.S. exports is high-value services, estimated to be around $8-$9 billion. This includes intellectual property licensing, management consulting, and digital services required by Denmark’s highly digitized economy.
• Machinery and Technology (Goods): U.S. goods exports, including advanced industrial machinery, IT equipment, and electrical components, typically stand at about $6-$7 billion.
• Aerospace and Defense: This sector includes U.S. exports of aircraft, aircraft parts, and defense-related technology, supporting regional transportation and security needs.
• Source: BEA

In terms of overall trade, Denmark has maintained a strong trade surplus. In 2024, total exports were valued at $133.70 billion, while total imports were $123.22 billion, resulting in a trade surplus of over $10 billion.

Denmark’s position within the Nordic region offers additional opportunities for U.S. companies. The combined Nordic market (Denmark, Finland, Norway, and Sweden) has an aggregate GDP of over $1.5 trillion and a population of nearly 28 million people, making it an attractive and innovative marketplace for U.S. products, technologies, and services.

Political & Economic Environment

For background information on the political and economic environment, please visit the U.S. Department of State Investment Climate Statement website or the U.S. Embassy in Denmark website.