The Ministry of Finance has published the December 2009 edition of its Economic Survey.
The main points in the survey are:
- Economies all across the world were hit hard by the international crisis in 2009. Many indicators now suggest that the world economy is progressing and a moderate international recovery is expected, with increasing growth from the 3rd quarter of 2009.
- Danish economy is also gradually turning up again. The housing market is showing signs of stabilisation. Exports are improving and the fall in private consumption has slowed down.
- However, the improvement in the economy will not immediately feed through to the labour market. Unemployment is expected to rise to around 160,000 persons by the end of 2010, before it starts falling.
- The fiscal policy setting is very expansionary in 2009 and 2010 and public investments are set to increase by more than 30 per cent over the two years. Households’ real income is expected to grow by slightly more than 5 per cent in 2010, partly as an effect of the tax reductions.
- The expansionary fiscal policy, the fall in interest rates to historical low levels, and renewed growth abroad are expected to strengthen production and demand in Denmark with GDP growing by 1.3 per cent in 2010 and 1.6 per cent in 2011.
- Public finances are under strong pressure. The fiscal deficit is expected at around DKK 50 bn. in 2009 (3.0 per cent of GDP), DKK 94 bn. in 2010 (5.5 per cent of GDP) and DKK 79 bn. in 2011 (4.4 per cent of GDP).
Read Economic Survey, December 2009