The Danish economy is small, open and highly centred on trade with other countries. This thoroughly modern market economy features a high-tech agricultural sector and state-of-the-art industry with world-leading firms in pharmaceuticals, maritime shipping and renewable energy.

The Danish economy is also characterized by a large public sector, an equitable distribution of income, and comfortable living standards for the large majority of people. Denmark is a net exporter of food and energy and has enjoyed a comfortable balance of payments surplus for a long period. After a long economic upswing, Denmark's economy began slowing in early 2007 with the end of a housing boom.

The global financial crisis has intensified the economic slowdown and though unemployment is likely to rise through 2010, Denmark is expected to make a slow and modest recovery. Denmark maintained a healthy budget surplus for many years up to 2008, but the budget balance swung into deficit during 2009. Even so, Denmark's fiscal position remains among the strongest in the EU and the country has a very high level of GDP per capital (26,700 EUR). The Danish currency, kroner (one DKK approx. 0.13 EUR), has been tied to the Euro since its inception in January 1999 and has held its position as a strong currency.

The value of both exports and imports constitutes approximately 1/3 of GDP. About 2/3 of foreign trade is with other EU countries.

The small size of the domestic market prompted Danish manufacturers to seek customers abroad at an early stage, so the Danish manufacturing industry is highly oriented on export. On account of the great importance of foreign trade for the domestic economy, Denmark attaches great importance to free trade in goods and services across country borders. Consequently, Denmark has joined collaborative organizations such as the EU, OECD and WTO and within the framework of these it has worked actively for the removal of obstacles to free trade.

The level of administrative obligations in Denmark is low and the Danish government is dedicated to creating a flexible and competitive business environment. Few barriers exist in the market-place and the level of barriers to trade and investment are relatively low in Denmark compared to other European countries. In 2001 foreign direct investment flows and stocks into Denmark reached 11,218 million USD.

Sources:

OECD
Royal Danish Ministry of Foreign Affairs
Statistics Denmark

CIA – the World Factbook