Denmark

IV

Economy

Denmark has traditionally been an agrarian country and agriculture is still a key economic sector, contributing 19.3 per cent of export earnings. Since the end of World War II, however, manufacturing, including high-tech industries, and services have gained in importance. They employ 20 per cent and around 40 per cent of the labour force respectively (1994 figures); employment in agriculture (including forestry and fishing) is 3 per cent compared with an estimated 14 per cent in 1965. Industry and services contribute respectively 24.6 per cent and 73.5 per cent of GDP; agriculture 1.8 per cent. Danish ships, which operate in foreign waters, contribute substantially to the economy. The country is also profitably involved in foreign investments, shipbuilding, and foreign construction. The annual national budget in 2004 included about US$88.20 billion in revenue and US$84.98 billion expenditure. GNP in 2004 was US$220 billion (World Bank), equivalent to US$48,330 per capita, one of the highest in the world.

A

Agriculture, Forestry, and Fishing

Danish agriculture is highly efficient. Danish governmental policy favours small landholdings; the merger of smallholdings to form large estates is discouraged by law. About 85 per cent of the farms of Denmark are less than 50 hectares (124 acres) in size and most are family owned.

Of the more than 2,237,000 hectares (some 5,527,748 acres) under cultivation, about 60 per cent are devoted to cereals, mainly barley, oats, wheat, and rye; the rest are planted with fodder and other crops, including flax, hemp, hops, and tobacco. Agricultural production in 2006 included about 4.83 million tonnes of wheat, 3 million tonnes of barley, and 129,600 tonnes of rye. The meat and dairy industries are very important and overwhelmingly export oriented. In 2005 Denmark had 13.5 million pigs, 1.54 million cattle, and 47,472 horses. In 1995 milk production was over 4.6 million tonnes; pork and bacon, 1.5 million; cheese, 311,000; and butter, 54,000.

A notable feature of agriculture in Denmark is the influence of the cooperative movement. Cooperative associations dominate the production of dairy products and bacon. A large percentage of agricultural produce is sold through marketing cooperatives. Most cooperatives are organized in national associations, which are members of the Agricultural Council, the central agency for the cooperatives in dealings with the government and industry, and in foreign trade.

Denmark’s forest resources are negligible. All forests have been government reserves since 1805. The large Danish fishing fleet (over 3,200 motorized vessels) plays a significant role in the economy. The total annual catch in 2004 was about 1.13 million tonnes, almost all of which were marine fish. The most important fish caught are herring, salmon, and cod. A dispute persists between Greenland and Iceland over fishing rights in the Denmark Strait.

B

Mining

All Danish subsurface resources are the property of the nation. Kaolin is found on the island of Bornholm, but the deposits are not of high quality and it is used chiefly in the manufacture of coarse earthenware and brick. Natural gas and oil have been recovered from offshore North Sea fields since the 1970s; the output of crude oil had reached 375,047 barrels per day by 2004. In 1993 Denmark became a net oil exporter and expansion of oil and gas production balanced energy imports and exports by 1997. Reserves of oil are estimated at 729,618,000 billion barrels. Other commercially produced minerals are limonite, lignite, cryolite, limestone, chalk, and marl. Large quantities of salt have been discovered in Jutland.

C

Manufacturing

Denmark’s principal industries, by value of output, are food processing, steel and metals, chemicals and pharmaceuticals, printing and publishing, machinery, electronic goods, and transport machinery production (notably marine and locomotive diesel engines). Danish furniture has been in demand throughout the world since the 1920s. Other significant industries include iron-founding, shipbuilding, brewing, and the manufacture of clothing and textiles, cement, chemicals, drugs, electronic equipment, earthenware, porcelain, glassware, stoves, bicycles, and paper.

D

Energy

Denmark supplies more than half of its own energy requirements, thanks to North Sea oil and gas deposits and energy conservation measures. Almost all Denmark’s electricity is produced in thermal plants using coal or petroleum products. In the 1990s the country had an installed electricity-generating capacity of about 10.03 million kW, and in 2003 annual production was approximately 43.3 billion kWh. The application of wind turbines for generating electricity was pioneered in Denmark late in the 1890s and they are in widespread use there today.