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Country Profile | Denmark

Country Profile | Denmark
20 August 2019

 

For the 2014-2020 financial framework of European Structural and Investments Funds, Denmark was allocated a total of €1.5 billion, which, added to a national contribution of €770 million, see Denmark reaching a total budget of €2.3 billion to be invested in various areas.

In fact, this budget is intended to be used through four national and regional programmes to:

  • Help SMEs in industry, services, agriculture, aquaculture and fisheries to be more innovative and better at turning innovation into profit, with support focusing on clusters and cooperation networks;
  • Help people on the margins of the labour market and improve employability by helping more people to complete vocational training and higher education;
  • Focus on protecting and preserving natural assets, improving water quality and biodiversity, and using cultivated land and fish stocks in an environmentally-friendly and sustainable way;
  • Improve resource efficiency as part of Denmark’s strategy to increase business competitiveness, contributing also to the nation’s transition to a low-carbon economy.

 

The Danish government has been focused on investing the budget of the European Structural and Investment Funds mainly on protecting the environment and tackling climate change-related issues, with around €1 billion coming from the European Agricultural Fund for Rural Development (EAFRD) and the European Maritime and Fisheries Fund (EMFF), which contributed for respectively €800 million and €200 million. Relevant to the government’s agenda is also a boost to the competitiveness of small and medium enterprises, especially in the fishing and services sectors. In fact, more than €300 million are destined to address this topic, with €130 million, €97 million and €77 million coming from the European Regional Development Fund (ERDF), the EAFRD and the EMFF respectively. 

Chart 1

 

Chart 1 shows that the Danish government gives particular attention to research and innovation, with €200 million granted by the ERDF and EAFRD: this budget is going to improve the already existing research structures, as well as to enhance the cooperation between the private sector, research institutions and universities. In addition, more than 2700 enterprises are being helped to develop new products, boosting their overall competitiveness and revenues.

In order to understand thoroughly the composition of the EU funding budget of Denmark, Chart 2 breaks down the amount of money that each Fund is giving to the country, by showing their share in the €2.3 billion budget.

 

Chart 2

 

With 51.8%, the European Agricultural Fund for Rural Development is the largest contributor to European funding in Denmark, granting €1.2 billion alone, more than half of the total. The European Social Fund (ESF) accounts for 17.9%, a budget of €410 million that is used to increase jobs, improve educational and vocational training, and to enhance social inclusion. The European Regional Development Fund contribute for 17.7%, granting €400 million for research and innovation, and for the transition of Denmark towards a low-carbon economy. With €300 million and a share of 13.3%, the European Maritime and Fisheries Fund helps to improve the competitiveness of aquaculture and fisheries small and medium enterprises, and heavily contributes to the protection of the Danish land and water environments.

The country’s absorption rates are high, but when compared to other Scandinavian countries Denmark lags behind. With a 35% share of spent funding from the ESIF, Denmark has a high percentage among EU member countries, being 7% above the European average of 28% and meaning that more than €800 million have already been invested. Denmark is also very effective when it comes to assigning funds: in fact, the country has allocated 75% of its total budget, 10% above the EU average of 65%, meaning that €1.7 billion have been assigned to projects and other initiatives. 

However, as previously stated, these absorption rates, when compared to the country’s Scandinavian neighbours, are relatively low: Sweden’s spent funding rate is 15% higher, and the allocated funding rate is 10% above Denmark’s; the difference increases when compared to Finland, which has a rate for spent funding of 55% and an allocated funding rate of 88%. Not only that, but the Danish absorption rates of 2019 have seen an increase of just 4% from the ones of 2018, meaning that not many efforts have been made to improve the assimilation of European funding.

In conclusion, Denmark registers high absorption rates compared to the European Union average, but at the same time the country’s rates for the 2018-2019 biennium show that there is still lots of room for improvement for the last year of the Financial Framework.

 

Facts:

Name: Denmark                                           

Capital: Copenhagen

Government: Parliamentary Constitutional Monarchy

Population: 

Area: 42,933 km2

GDP per capita: €57,900                  

Currency: Danish Krone (Kr/DKK)

 

 

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