Market Overview
Denmark is a constitutional monarchy which shares a southern border with Germany and which is connected by bridge to southern Sweden. With a total area of 43,096 sq. km. (16,640 sq. mi.) it is slightly smaller than Vermont and New Hampshire combined. The total population is 5.38 million people.
Denmark is a rich, modern society with a state-of-the-art infrastructure and distribution system, a highly skilled labor force and a central location that makes it an excellent distribution point for the Scandinavian, Northern Europe and Baltic markets.
Denmark’s standard of living, with a per capita GDP of USD 53,354 in 2006, is among the highest in the world.
Denmark is a firm advocate of liberal trade and investment policies and actively encourages foreign investment. The country has been a member of the European Union (EU) since 1973.
There are 350 American subsidiaries established in Denmark and a strong American Chamber of Commerce with more than 250 members.
Political and commercial relations with the United States are excellent. The United States is Denmark's largest trading partner outside the EU and has a share of 5.2 percent of total Danish trade in goods.
Denmark’s major imports from the United States are: industrial machinery, capital equipment, computers and telecom products, software, aircraft, and scientific instruments. Other important U.S. exports to Denmark are military equipment, chemicals and pharmaceuticals, tobacco, wine, fresh vegetables, nuts, and forest products.
American-owned firms in Denmark are prominent in information technology (IT) and telecommunications products and services, and in offshore oil and gas exploration and production.
Market Challenges
Danish consumers are relatively conservative. They prefer to buy products that have already proven their technology and value.
Danish companies believe in long-term relations. Companies that are in the market chiefly to “make a fast buck” may find better opportunities in markets other than Denmark.
Danish wages are high and personal taxes are among the highest in the world but corporate taxation is among the lowest in the EU.
Denmark has decided not to participate in the Euro but the Krone is firmly linked to the Euro with a very narrow band (2.25 percent) of Central Bank intervention rates. However, the government’s monetary and exchange rate policies aim at price stability and building international confidence in a strong Danish economy. There is strong international confidence in the Danish economy and the Krone.
Market Opportunities
The import climate is open and receptive to U.S. products and investments. There are no significant trade barriers or regulations that U.S. firms need to take into consideration. Danish imports are very diversified and many opportunities are available.
The most promising sectors for market growth for U.S. non-agricultural companies in the coming year include: IT and telecommunication equipment and services, biotech and pharmaceutical products, tourism services, financial services, electrical power systems, offshore oil and gas field equipment, consumer goods and advanced medical equipment. The most promising agricultural export prospects are wine, forest products, feed (including pet food), fresh vegetables and processed foods.
U.S. companies are expected to maintain and expand their market share in the coming years. In high-technology areas such as information technology and medical equipment, U.S. companies are already market leaders and are expected to increase their lead.
Denmark is an industrialized “value-added” country, dependent on foreign supplies of most raw materials and semi-manufactures. However, it is a net exporter of oil, and has more than one-third of the world’s wind technology turbine sales.
Services are playing an increasingly important role in the economy. Communication and information technologies play a steadily growing role in the Danish/U.S. services trade. Other important service sectors include management consulting and financial services. Tourism is a growing market and approximately 150,000 Danes visit the United States each year.
Market Entry Strategy
U.S. exporters seeking general export information and assistance or country-specific commercial information should consult with their nearest Export Assistance Center or the U.S. Department of Commerce's website www.export.gov. Information about services offered by the U.S. & Foreign Commercial Service in Denmark can be found at http://www.buyusa.gov/denmark