Doing Business In - Denmark
Government
Denmark is a constitutional monarchy with Queen Margrethe II as head of state. Since 1849 the power of the royals has declined and today their power is only ceremonial. The real political power is centred on Government and Parliament.
The Danish political system is a multi-party structure, with several parties represented in the Parliament. Danish governments are most often minority administrations, governing with the aid of one or more supporting parties. This means that Danish politics are characterised by inter-party compromising. Since 1909 no single party has had the majority of parliamentary seats. Political life is orderly, stable and democratic and in 2010 Transparency International ranked Denmark as the least corrupt nation in the world.
Political changes occur gradually through a process of consensus, and political methods and attitudes are generally moderate. The current government's priorities are to maintain an advanced health and social security system, through the reform of economic, taxation and labour market policies, education and training.
Denmark and the EU
Denmark has been an active member of the EU since 1973. Denmark sets the standard with respect to fast implementation of EU regulations into national legislation. The country has the lowest number of infringement proceedings before the Court of Justice, and a tradition for public debate and transparent public administration, which is reflected in the Danish European policy.
In 2001 Denmark signed the Schengen Agreement permitting free travel amongst the member states. Economy Situated close to the Swedish boarder in the eastern part of Denmark, Copenhagen is the economical locomotive and centre for research and development. The international climate and a well educated workforce attract people and business from all over the world and many international companies have placed their European and Scandinavian headquarters or R&D departments here.
With very few natural resources, the mixed economy of Denmark relies almost entirely on human resources and the service sector makes up the vast part of the employment and the economy. Like the rest of the world Denmark has been affected by the global economic crisis since 2008 but has managed through the crises as one of the least affected countries in the EU. In the beginning of 2011 unemployment is about 6 percent and the yearly economical growth in 2011-2012 is expected to be around 1.5 – 2 percent.
Denmark produces oil, natural gas, and wind-and bio-energy. Its principal exports are green-tech, machinery, instruments and food products. Denmark has a long and proud maritime history and shipping is still one of the mayor businesses. The largest shipping company in the world, A.P Møller/Maersk, is based in Denmark. Main trading partners are other EU member states, especially Germany, Sweden and Great Britain.
Labour market - the Flexicurity model
Flexicurity is a compound of flexibility and security but the Danish model has a third element—an active labour market policy—and together these elements comprise the golden triangle of flexicurity. One side of the triangle is flexible rules for hiring and firing, which make it easy for the employers to dismiss employees during downturns and hire new staff when things improve.
Every year, 25 percent of the workforce in the private sector change jobs. The second side of the triangle is unemployment security in the form of a guarantee for a legally specified unemployment benefit at a relatively high level—up to 90 percent for the lowest paid workers. The third side of the triangle is the active labour market policy. An effective system is in place to offer guidance, a job or education to all unemployed. Denmark spends approx. 1.5 percent of its GDP on active labour market policies. The model allows companies to respond to changing market trends without serious losses. Moreover, entrepreneurs are keen to start businesses, as they can easily get rid of employees if the project fails. If an idea is to be tested, Denmark is therefore the ideal place to do it, not only because of the flexible labour market but also because the population has purchasing power.
R&D and Education
Ranked second on the European Innovation Scoreboard in 2011, Denmark is among the best countries in offering research results and knowledge to new technologies, processes, goods and services. High quality education at all levels is essential to ensure competitiveness in today’s globalised world. Education and high academic standards are key priorities in Denmark. Combined with innovative learning approaches, the Danish institutions are preparing their students to play an active role in a globalised, knowledgebased society.
The Danish political system is a multi-party structure, with several parties represented in the Parliament. Danish governments are most often minority administrations, governing with the aid of one or more supporting parties. This means that Danish politics are characterised by inter-party compromising. Since 1909 no single party has had the majority of parliamentary seats. Political life is orderly, stable and democratic and in 2010 Transparency International ranked Denmark as the least corrupt nation in the world.
Political changes occur gradually through a process of consensus, and political methods and attitudes are generally moderate. The current government's priorities are to maintain an advanced health and social security system, through the reform of economic, taxation and labour market policies, education and training.
Denmark and the EU
Denmark has been an active member of the EU since 1973. Denmark sets the standard with respect to fast implementation of EU regulations into national legislation. The country has the lowest number of infringement proceedings before the Court of Justice, and a tradition for public debate and transparent public administration, which is reflected in the Danish European policy.
In 2001 Denmark signed the Schengen Agreement permitting free travel amongst the member states. Economy Situated close to the Swedish boarder in the eastern part of Denmark, Copenhagen is the economical locomotive and centre for research and development. The international climate and a well educated workforce attract people and business from all over the world and many international companies have placed their European and Scandinavian headquarters or R&D departments here.
With very few natural resources, the mixed economy of Denmark relies almost entirely on human resources and the service sector makes up the vast part of the employment and the economy. Like the rest of the world Denmark has been affected by the global economic crisis since 2008 but has managed through the crises as one of the least affected countries in the EU. In the beginning of 2011 unemployment is about 6 percent and the yearly economical growth in 2011-2012 is expected to be around 1.5 – 2 percent.
Denmark produces oil, natural gas, and wind-and bio-energy. Its principal exports are green-tech, machinery, instruments and food products. Denmark has a long and proud maritime history and shipping is still one of the mayor businesses. The largest shipping company in the world, A.P Møller/Maersk, is based in Denmark. Main trading partners are other EU member states, especially Germany, Sweden and Great Britain.
Labour market - the Flexicurity model
Flexicurity is a compound of flexibility and security but the Danish model has a third element—an active labour market policy—and together these elements comprise the golden triangle of flexicurity. One side of the triangle is flexible rules for hiring and firing, which make it easy for the employers to dismiss employees during downturns and hire new staff when things improve.
Every year, 25 percent of the workforce in the private sector change jobs. The second side of the triangle is unemployment security in the form of a guarantee for a legally specified unemployment benefit at a relatively high level—up to 90 percent for the lowest paid workers. The third side of the triangle is the active labour market policy. An effective system is in place to offer guidance, a job or education to all unemployed. Denmark spends approx. 1.5 percent of its GDP on active labour market policies. The model allows companies to respond to changing market trends without serious losses. Moreover, entrepreneurs are keen to start businesses, as they can easily get rid of employees if the project fails. If an idea is to be tested, Denmark is therefore the ideal place to do it, not only because of the flexible labour market but also because the population has purchasing power.
R&D and Education
Ranked second on the European Innovation Scoreboard in 2011, Denmark is among the best countries in offering research results and knowledge to new technologies, processes, goods and services. High quality education at all levels is essential to ensure competitiveness in today’s globalised world. Education and high academic standards are key priorities in Denmark. Combined with innovative learning approaches, the Danish institutions are preparing their students to play an active role in a globalised, knowledgebased society.