Our comprehensive assessment of Denmark's operating environment and the outlook for its leading sectors are formed by bringing together a wealth of data on global markets that affect Denmark, as well as the latest industry developments that could impact Denmark's industries. This unique integrated approach has given us an impeccable track-record for predicting important shifts in the markets, ensuring you’re aware of the latest market opportunities and risks in Denmark before your competitors.
Denmark Country Risk
Economic growth in Denmark will remain strong as economic conditions in the eurozone improve and domestic demand benefits from ultra-loose monetary policy.
Lower interest rates for consumers will bolster disposable income for households.
Anti-immigration sentiment will dominate Denmark's political landscape long after the September general election.
Major Forecast Changes
We now forecast 1.4% and 1.6% real GDP growth in 2015 and 2016 respectively, from 1.5% for both years previously.
Risks To Outlook
Should markets resolve to keep testing the National Bank's determination to keep its peg to the euro in the event of renewed risk...
Denmark Industry Coverage (9)
Looking at early sales trends for 2015, a total of 58,094 vehicles were sold in Denmark over the first quarter, representing a 5.5% increase year-on-year (y-o-y). Breaking down the headline figure, passenger car sales stood at 49,278 units (+3%) for Q115. LCV sales were up by 17.4%, at 7,595 units. HCV sales were up by 67.5%, at 1,146, with HCV sales units, with bus sales up by 19%, at 75 units. Total CV sales stood at 8,816 units for the first quarter of 2015.
After two disappointing months at the start of the year, March was a particularly strong month for new vehicle sales, which were up by 18.8% y-o-y, at 23, 286 units. On current sales trends, there may some slight upside to our forecasts of 4% growth for the full year. However, we choose to await the release of additional monthly sales data before making any change to our current forecasts.
Overall, however, we retain a constructive view on the medium-term outlook...
Food & Drink
Denmark Food & Drink
BMI View: Boasting a consumer base of 25mn with some of the strongest purchasing power in the world and offering a favourable business and regulatory environment, the four Nordic markets potentially hold lots of attractive investment opportunities. That said, we note limited opportunities for growth as the economic and demographic outlook remains relatively grim and the food and drink markets are highly concentrated, thus presenting significant challenges for new entrants.
Food consumption (local currency) growth year-on-year (y-o-y) in 2015: +3.6%; compound annual growth rate (CAGR) 2014-2019: +4.5%
BMI View : The insurance market in Denmark is very well developed, with both life and non-life insurance enjoying high rates of penetration and density. As a mature market, growth across most lines is expected to be slow throughout the forecast period and driven primarily by wider economic expansion in the country, though health insurance is expected to be the outperformer with more robust growth expected from 2016 onwards.
The Danish insurance sector will continue to outpace the country's GDP growth over the coming years as the domestic pension system underpins expansion in the sector. Danish insurers remain good stewards of capital as their asset base has grown faster than the new business they have undertaken over the past few years. The large size...
Denmark Medical Devices
BMI Industry View: Denmark represents a mature medical device market with above average per capita spending. The market is being constrained by slow economic growth, which is increasing pressure to scale back the country's generous welfare system. As such the market is only expected to show low growth with a US dollar CAGR of 1.9% forecast for the 2013-2018 period. Local production is focused on consumables and patient aids, primarily hearing aids, leaving the majority of the market heavily dependent on imports.
Headline Industry Forecasts
The medical device market is valued at USD1,587.3mn in 2013, equal to USD283 per capita. The market is projected to grow at a CAGR of 1.9% in US dollar terms and 3.8% in local currency terms over the 2013-2018 period to attain a value of USD1,740.2mn by 2018.
Medical device imports...
Oil & Gas
Denmark Oil & Gas
BMI View: We expect a partial, but temporary recovery in oil and gas volumes over the medium term, as small developments come online. Past 2019 however, production will resume to the downside. While the country should remain a net oil and gas exporter, exports will become increasingly thin by the end of our forecast period.
Pharmaceuticals & Healthcare
Denmark Pharmaceuticals & Healthcare
BMI View: Denmark has a relatively small pharmaceutical market compared to many of its Western European counterparts. Despite the country's economy returning to growth in 2014, pharmaceutical sales are not expecting to follow suit until 2016. In the longer term, Denmark's aging population will have an unprecedented effect on the market with an older generation driving medicine and healthcare expenditure. However, in-line with many other European governments, the Danish government will increasingly off-set the positive effects of higher demands with price control mechanisms that dampens our outlook for the market.
Headline Expenditure Projections
Pharmaceuticals: DKK19.92bn (USD3.16bn) in 2014 to DKK19.65bn (...
BMI View: Our fundamental assumptions for Denmark, Finland and Sweden continue to be relevant. We maintain our long-held view that, while growth expectations in the region are improving, economic woes in the eurozone remain a major risk factor for the consumption and generation outlook of the three Nordic countries, as more regional instability could undermine their economic activity. In terms of sector trends, we note Denmark appears to be losing its energy self-sufficient status...
BMI View: This quarter we have extended our forecast to 2024. This notwithstanding, our projections for non-hydropower renewable energy generation in Denmark, Finland and Sweden are largely unchanged, as our fundamental assumption for the Nordic markets considered in the report remain unvaried. Key projects in the region continue to progress in line with our expectations, with Denmark's progressive loss of its energy self-sufficient status likely to lead the country to a greater focus on the prompt development of renewables. We also note that Sweden's possible phase-out of nuclear energy could jeopardise the reliability of the system, while pushing the country towards a larger share of renewable generation.
Key Trends And Developments
The incoming Social Democrats and Green Party in Sweden have announced a coalition...
BMI View: The Danish telecommunications market is highly mature and increasingly focused around value-added premium services. Most notably, while the broadband market is growing steadily on the back of demand for converged services, the mobile sector is beginning to show signs of fatigue, with periodic declines in subscriber numbers linked to the retirement of low-value or inactive accounts. Curiously, adoption of M2M services lags behind other equally advanced European markets, although growth now seems to be accelerating. In this environment, there are scant opportunities for new or risk-averse investors, although the potential for niche value-added services is far from played out.
The wireline market is forecast to continue shrinking, from 1.991mn connections in 2014 to 1.619mn by 2019. This is despite continued interest in...