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    Analyses: Few industrial groups contribute massively to Denmark's balance of payments surplus

    For a long period, Denmark has had a surplus on the balance of payments. The manufacturing industry contributes massively to the balance of payments surplus because the sector has extensive net exports of goods. Danish industrial groups have increasingly become globally organised producing goods across borders., Accordingly, there is a close correlation between the manufacturing industry’s investments in foreign subsidiaries and Danish exports and investment income that impacts the balance of payments statistics., As part of the examination of the international organisation of industrial groups and their significance to the Danish economy, this analysis examines investments abroad and the groups’ total contribution to the balance of payments surplus in 2018. To illustrate the presence abroad, we apply a new approach to examine the ultimate destinations for the industrial groups’ investments., Main conclusions:, The contribution by just five large industrial groups to the balance of payments surplus corre­sponds nearly to the entire Danish balance of payments surplus in 2018., The industrial groups’ total contribution to the balance of payments was DKK 297 billion in 2018, which is almost twice the total balance of payments surplus., The surplus is driven by goods exports of which an increasing part never crosses the Danish border, because the goods are produced by subsidiaries abroad., Danish industrial groups have substantial investments in subsidiaries abroad. Complex group structures often lead to investments passing through several countries before they reach their final destinations., A new method for calculating ultimate hosting countries for the investments shows that par­ticularly investments in China and Russia are channelled through other countries., Get as pdf, Few industrial groups contribute massively to Denmark's balance of payments surplus, Colophone, Few industrial groups contribute massively to Denmark's balance of payments surplus, Subject group: Economy, Released: 17 February 2020 08:00, No. 2020:05, ISSN pdf: 2446-0354, Contact:, Mads Møller Liedig, Telephone: +45 40 12 97 72

    Analysis

    Analyses: Large increase in sales of goods abroad by Danish manufacturing industries

    Globalisation means that Danish enterprises are increasingly organising their production across borders. Today, processing abroad, traditional trading with goods across borders, as well as purchases and sales of goods not crossing Danish borders (merchanting) have become closely linked. This trend has been particularly strong over the past decade., This analysis describes how enterprises organise production internationally, with special focus on Danish manufacturing industries’ production and sales abroad. The analysis is based on new figures for balance of payments and international trade in goods and ser­vices, which were published on 10 October 2016., Main conclusions of the analysis: , In 2005, Danish manufacturers sold goods abroad which were not produced in Denmark for about DKK 8 bn. In 2015, this figure had risen to more than DKK 120 bn., Sales of merchanting goods by manufacturing industries, i.e. goods purchased and sold outside of Danish borders, amounted to almost DKK 70 bn. in 2015. The merchanting goods were primarily sold in other EU countries., Purchases abroad by Danish enterprises of foreign goods for processing abroad have in­creased over ten years from virtually zero to almost DKK 16 bn. In the same period, pur­chases by Danish enterprises of processing services abroad have risen from almost DKK , 1 bn. to almost DKK 9 bn., Get as pdf, Large increase in sales of goods abroad by Danish manufacturing industries, Colophone, Large increase in sales of goods abroad by Danish manufacturing industries, Subject group: Economy, Released: 18 November 2016 09:00, No. 2016:22, ISSN pdf: 2446-0354, Contact:, Pia Nielsen, Telephone: +45 30 61 93 05

    Analysis