The economic council predicted that private consumption would increase by 2.5 percent by 2016. Photo: Colourbox
The Danish Economic Council (Det Økonomiske Råd – also known as the ‘economic wise men’) released its take on the national economy on Wednesday. The wise men predicted that Denmark’s gross domestic product (GDP) would grow by 1.6 percent this year and by 2.1 percent increase in 2016. The projections are down slightly from the spring forecast, with the wise men saying that the downgrades are a result of a weakening of the global economy over the summer.
“We expect that the growth will be strong enough to result in an increase in employment of around 100,000 jobs between the years 2015 and 2017. Looking ahead to 2025, we expect an employment growth of 250,000,” council member Hans Jørgen Whitta-Jacobsen told broadcaster DR.
The forecast called for employment figures to grow by 26,000 this year and 33,000 in 2016.
Although the wise men’s report slightly lowered the GDP outlook, they had a markedly more optimistic take on the economy than the Finance Ministry.
The ministry said in August that Denmark’s structural balance showed a 2015 deficit of 0.7 percent of the nation’s GDP, higher than the 0.5 percent mark allowed under the budget. The ministry said that in order to bring the deficit down to the acceptable level, it would have to implement significant budget cuts.
But the wise men’s report said that Denmark’s structural balance shows a 0.3 percent surplus for 2015 and a surplus of around 0.5 percent each year through to 2020.
The wise men also predicted that private consumption will increase significantly, going from just 0.5 percent growth last year to 1.9 percent this year and 2.5 percent in 2016. Along with the increased spending, the council predicted that consumer prices would increase by 1.0 percent this year and 1.6 percent next year.