Tuesday 11 October 2011

Denmark: Competitiveness challenges

After Productive and sustainable Denmark as seen by the World Economic Forum (WEF), we look at what Denmark has planned in order to become even more innovative and competitive, in line with the aims of Europe 2020 strategy (EU2020) for smart, sustainable and inclusive growth.

National Reform Programme 2011

Last spring, in line with the European semester and the Annual Growth Survey, each EU member state submitted the final version of its National Reform Programme to the Commission. To a large extent the Danish NRP 2011 builds on the 39-page Danmark 2020 programme from February 2010:

Danmarks Nationale Reformprogram 2011 (Maj 2011; 65 pages)

Thanks to the English versions, the NRPs can be studied more widely:

The Danish Government: Denmark's National Reform Programme (May 2011; 67 pages)

The Introduction offers an overview of the NRP contents:

 Chapter 1 deals with the overall framework for the Danish economy based on the 2020 Plan.
 Chapter 2 focuses on the Danish national targets which will contribute to fulfilling the Europe 2020 strategy and strategies for meeting the targets.
 Chapter 3 identifies the structural bottlenecks for growth in Denmark.
 Chapter 4 describes the inclusion of relevant ministries and non governmental organisations relevant for the Europe 2020 strategy, including their involvement in the drawing up of the national reform programme.

Competitiveness challenges

After presenting the macroeconomic background, the Danish NRP moves on to more specific issues of competitiveness. These reveal a number of challenges to Denmark's future prosperity. Two major ones:

The programme noted that between 1999 and 2009 Denmark recorded the second-lowest annual rate of productivity growth among the OECD countries.

Wage costs in Denmark have risen more than in Germany and elsewhere abroad during a number of years. In the Danish manufacturing industry wage costs are higher than in all other OECD countries except Norway.

Ralf Grahn

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