Ben Hamilton
January 16th, 2019

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Ludger Schuknecht and Kristian Jensen yesterday (photo: Hasse Ferrold)

The OECD has given the Danish economy a glowing report (see the report here in English).

Ludger Schuknecht, the OECD deputy secretary general, yesterday visited the Finance Ministry to personally hand over the report to its minister Kristian Jensen.

Strong traditions and institutions
In the report, the OECD praised Denmark’s high standard of living and quality of life, effective pension and benefit reforms, “proximity to the technological frontier thanks to digitalisation and favourable business framework conditions”, and its commitment to environmental concerns.

“A long tradition of reforms and strong institutions support considerable confidence and high participation in the labour market, which ensures that high economic development is combined with low inequality. Strong readiness for structural changes and economic shocks ensures that these good results last,” it noted.

“A strong commitment to dealing with environmental challenges has made Denmark a pioneer in green growth.”

Productivity could be better
However, it cautioned that “improving public sector efficiency remains a challenge” and that disappointing productivity growth – “with a particular weakness in less knowledge-intensive service industries” – could hinder future well-being.

“Policy needs to embrace innovative technologies by resisting attempts to discourage or exclude them and by tackling unintended or outmoded obstacles in legislation and regulation,” it noted.

“Reducing high marginal taxes, broadening innovation activity and attracting more high-skilled foreign workers are also priorities.”

Minister encouraged
Jensen said he was encouraged how well the Danish economy is doing in an international context.

“One of the things we are good at in Denmark is getting many people out into the labour market,” he contended.

“At the same time, I note that the OECD commends Denmark for being a green pioneer.”

Politicians not in favour of Ørsted sale of Radius electricity provider
The Finance Ministry has informed Ørsted that there is no longer any support for its proposed sale of Radius, the electricity distribution business that has over a million customers in Zealand. Ørsted countered in a stock exchange announcement that it still believes a new owner – most probably a foreign pension fund – was in the best interest of the company, shareholders and customers. However, the sale is being viewed as an effective privatisation by the likes of Socialdemokratiet, SF and Dansk Folkeparti, as Ørsted is 50 percent owned by the state, and there are fears a new foreign owner would raise prices substantially. The finance minister, Kristian Jensen, has questioned S’s double standards, given it has no objection to Danish pension funds owning energy infrastructure abroad.

Danske Bank faces 28 million euro fine in France
A French judge has warned Danske Bank that it could face a 28 million euro fine in relation to the money-laundering scandal that engulfed its Estonian branch in 2017, following revelations that 1.5 trillion kroner passed through in less than a decade. The judge has called upon the bank to represent itself at a hearing in front of the Tribunal de Grande Instance de Paris.

Toy stores closed as potential buyers wait in the wings
The January sale at five Fætter BR and 21 Toys”R”Us stores – the only remaining shops in Denmark following the bankruptcy of their owner Top-Toy – has been scrapped. However, it might not be bad news for the remaining employees, as new buyers are showing interest in acquiring some of Top-Toy’s assets, including the supermarket giants Coop and the Salling Group. In total, 1,200 employees have lost their jobs. Discount sales in Sweden and Finland are still planned.

Tax authorities closing in on Bitcoin speculators hoping to give them the slip
It could be bad news for Bitcoin speculators who have chosen to keep the taxman out of their dealings. The Skattemyndighederne tax authorities have received permission from the Skatterådet tax council to access information relating to all the trading that has taken place on three Danish crypto currency platforms from 2016 to 2018. A similar request made to the Finnish authorities last year yielded information on crypto currency trades carried out by 2,700 Danes worth 100 million kroner.

DSV tables bid for Swiss rival
DSV, the Danish transport and logisitics company, has tabled a 26.5 billion kroner offer for rival Swiss company Panalpina. With 14,000 employees and a presence in 70 countries, the acquisition would increase DVD’s staff to 62,000. For 2017, Panalpina made an operating profit of 683.5 million kroner while DSV declared a net profit of around 3 billion.