Denmark cuts growth forecast as demand falls

The Danish government on Thursday slashed its growth outlook for this year and the next, citing weak eurozone demand for exports and stagnant household spending.

Denmark cuts growth forecast as demand falls
Economy minister Morten Østergaard is facing economic growth that "is going slower than expected", as the slide behind him reads. Photo: Thomas Lekfeldt/Scanpix
Denmark's output growth is now expected to reach 0.75 percent this year, down sharply from a prediction of 1.4 percent made in August.
In 2015, it would be "almost 1.5 percent", also lower than an earlier estimate of 2.0 percent.
"The weaker growth in demand from abroad has contributed to weaker growth in Denmark and Danish companies and households have been more reluctant to invest and consume," the Ministry of Economic Affairs and the Interior said in a statement.
Consumption has slumped since Danes began paying down a heavy debt burden in the wake of a burst housing bubble, but the government said household finances were now becoming more "balanced".
Sydbank analyst Peter Bojsen Jakobsen said the new growth forecast was more "realistic" than before, but added that future revenue from North Sea oil was most likely overstated since it was based on an oil price of $85 per barrel, compared with a current price of around $64.
"Disregarding the government's view on the oil price, the forecast is in line with our view of the Danish economy," he said.

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‘We agree to disagree’: Still no progress in marathon SAS strike talks

By lunchtime on Friday, talks between the Scandinavian airline SAS and unions representing striking pilots were still stuck on "difficult issues".

'We agree to disagree': Still no progress in marathon SAS strike talks

“We agree that we disagree,” Roger Klokset, from the Norwegian pilots’ union, said at lunchtime outside the headquarters of the Confederation of Swedish Enterprise in Stockholm, where talks are taking place. “We are still working to find a solution, and so long as there is still some point in continuing negotiations, we will do that.” 

Mats Ruland, a mediator for the Norwegian government, said that there were “still several difficult issues which need to be solved”. 

At 1pm on Friday, the two sides took a short break from the talks for lunch, after starting at 9am. On Thursday, they negotiated for 15 hours, breaking off at 1am on Friday morning. 

READ ALSO: What’s the latest on the SAS plane strike?

Marianne Hernæs, SAS’s negotiator on Friday told journalists she was tired after sitting at the negotiating table long into the night. 

“We need to find a model where we can meet in the middle and which can ensure that we pull in the income that we are dependent on,” she said. 

Klokset said that there was “a good atmosphere” in the talks, and that the unions were sticking together to represent their members.

“I think we’ve been extremely flexible so far. It’s ‘out of this world’,’ said Henrik Thyregod, with the Danish pilots’ union. 

“This could have been solved back in December if SAS had not made unreasonable demands on the pilots,” Klokset added. 

The strike, which is now in its 12th day, has cost SAS up to 130m kronor a day, with 2,550 flights cancelled by Thursday, affecting 270,000 passengers.