Denmark: Economic and Political Outline

Economic Overview

The country was strongly hit by the financial crisis, due to its high degree of openness to international trade and to the high level of financialization of its economy. However, profiting from the resumption of trade, Denmark has experienced a more dynamic economic recovery than its European neighbors. GDP growth is estimated at 2% in 2010.

Fiscal and social measures adopted by the government in order to mitigate the effects of the crisis have destabilized public finances. Government’s priority in 2011, which was defined as part of a consolidation plan, is to lower the budget deficit by decreasing spending and increasing revenue.

Structural reforms are also planned. Denmark's economy suffers from relatively low productivity. The costs of employment are high but the number of working hours is low and there are many active adults receiving income benefits. The goal has been therefore to promote the human capital and encourage late retirement. Faced with the depletion of its petrol and natural gas reserves, the country has also set itself ambitious goals in terms of its energetic policy.

Denmark is a wealthy country, its per capita GDP figures among the highest in the world and its social inequalities are small. Although the unemployment rate remains low on European scale, it has clearly increased following the economic recession.

Main Sectors of Industry

The agricultural sector only accounts for 1.3% of the GDP and employs merely 2.7% of the population. Nevertheless, Denmark has become one of the major exporters of agricultural products. Two-thirds of its agricultural production are exported. Most of the Danish land is used for agriculture and there are more than 50,000 farmers in Denmark. Nearly 90% of the country's agricultural revenue comes from livestock production.

Denmark has limited natural resources, a fact which slows down the development of its heavy industry. However, the country has enough oil and gas reserves to ensure its energy freedom. Denmark is the world's leading manufacturer of wind turbines and exports 85% of its production. The major activity sectors are: chemical and pharmaceutical, biotechnology and services (approximately three-fourths of the GDP).

The services sector contributes nearly three-fourths of the GDP and provides most employment.

Source: World Bank - Last Available Data.

Indicator of Economic Freedom

Score:

78.6/100

Position:

Mostly free

World Rank:

8/179

Regional Rank:

3/42

Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation

Sources of General Economic Information

Ministries

Ministry of Economic and Business Affairs
Ministry of Finance
Ministry of Food, Agriculture and Fisheries

Statistical Office

Statistics Denmark

Central Bank

Danish National Bank

Stock Exchange

Copenhagen Stock Exchange

Main Online Newspapers

Jyllands Posten
The Copenhagen Post
The Copenhagen Star
Copenhagen Business
Borsen

Economic Portals

The Economist

Political Outline

Type of State

Denmark (official name: Kingdom of Denmark) is a constitutional monarchy based on parliamentary democracy.

Executive Power

The Monarch is the head of the state and theoretically holds all executive powers. But in reality the executive powers are exercised on behalf of the monarch by the Prime Minister.

Legislative Power

Following legislative elections, the leader of the majority party or the leader of the majority coalition is usually appointed Prime Minister by the monarch for a four-year term. The cabinet, called Council of State, is appointed by the Monarch on Prime Minister's recommendation. 
The legislature is unicameral. The parliament called People's Assembly has the ultimate legislative authority; its members are elected by popular vote on the basis of proportional representation to serve four-year terms. On a vote of no confidence motion the parliament may force the entire government to resign.

Main Political Parties

Denmark has a multi-party system, with the following four parties as major political parties:
- Liberal Party – a social liberal party, advocates major reforms in country's education & tax systems;
- Social Democratic Party – follows social-democratic ideology, supports public spending on healthcare, education and infrastructure;
- Conservative People's Party – a conservative centre-right political party;
- SF (Socialist People's Party) – follows popular-socialism inspired by socialism and green politics.

Current Political Leaders

Monarch: Queen Margrethe II (since January 1972); heir apparent Crown Prince FREDERIK
Prime Minister: Helle THORNING-SCHMIDT since 3 October 2011  – Socialdemokraterne (Social Democrats).

Next Election Dates

Parliamentary: September, 2015.

Indicator of Freedom of the Press

World Rank:

11/179

Evolution:

same place compared to 2010

Source: Worldwide Press Freedom Index 2010, Reporters Without Borders

Indicator of Political Freedom

Ranking:

Free

Political Freedom:

1/7

Civil Liberties:

1/7

Map of freedom 2010
Source: Freedom House