Denmark is one of the most trade-oriented economies in the world. As a base for exporting, Denmark has many advantages. Its key location as the only Scandinavian country connected to mainland Europe, plus its position on the Baltic sea, gives it access to lucrative markets for both EU and non-EU countries. Its extensive infrastructure and well-educated, high-skilled workforce also help promote trade and foreign investment.
Germany is currently Denmark's most important export destination, followed by Sweden and the United Kingdom. Exports to these 3 countries totaled 41.7 percent of Danish exports in 1997. The United States is the largest trading partner outside the EU, and accounted for almost 5 percent of Denmark's total trade value in 1997. Over one-third of Danish industrial exports are machines and instruments, while pharmaceuticals, energy (especially oil), meat, and meat products make up the rest.
Trade (expressed in billions of US$): Denmark | ||
exports | Imports | |
1975 | 8.712 | 10.368 |
1980 | 16.749 | 19.340 |
1985 | 17.090 | 18.245 |
1990 | 35.133 | 32.228 |
1995 | 49.036 | 43.223 |
1998 | 47.070 | 44.994 |
SOURCE: International Monetary Fund. International Financial Statistics Yearbook 1999. |
Denmark's main imports are raw materials and unfinished products that are used in its own industrial sector. In 1997, imports for the industrial sector were about 70 percent of total imports, while the rest were consumer products, including cars. Of the services imported, computer software and management consulting are very important. Imports from Germany, Sweden, and the UK account for 42 percent of total imports.
The early 1990s were a difficult time for Danish international trade as its 3 most important markets—Ger-many, the UK, and Scandinavia—were all performing sluggishly. More recently trade has increased, especially due to a depreciation of the Danish krone. The krone is expected to remain stable through the next few years, which may reduce the growth in exports. However, Denmark is currently exporting more than it imports in all 3 sectors: industry, agriculture, and services.