The annual report to European Commission in the Convergence Programme is heavily affected by the severe economic situation that is due to the corona epidemic. The Programme underlines the extraordinarily large uncertainty surrounding the economic development.
The government has, backed by a broad majority of parties in the Danish parliament as well as employers and wage earners, employed extensive aid packages that will help underpin the Danish economy during the corona crisis and support the following recovery.
The many initiatives, for example wage compensation schemes, guarantees and postponement of payment deadlines etc. contribute to preventing long-lasting, negative consequences for the Danish economy due to the corona epidemic. However, a large contraction in 2020 cannot be prevented and the public balance will show a large deficit.
The EMU-debt will rise, but will – even in the most severe scenario – remain below the 60 per cent of GDP limit with a wide margin both this year and next year.