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Denmark reduces national debt by 25 percent since 2021

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Ritzau/The Local - [email protected]
Denmark reduces national debt by 25 percent since 2021
Denmark has significantly reduced its national debt since last year, according to central bank figures. File photo: Liselotte Sabroe/Ritzau Scanpix

The Danish national debt has fallen by as much as 25 percent since last year, according to figures from the country’s central bank.

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Denmark’s debt now corresponds to 11 percent of the country’s GDP, meaning around a quarter of the debt recorded in 2021 has been removed, new figures from Danmarks Nationalbank show.

The number is extraordinary and one of the lowest recorded for the metric, according to Kristian Skiver, senior economist with the Danish Chamber of Commerce (Dansk Erhverv).

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“The explanation for this is that the economy has come flying out of the coronavirus crisis with record-high employment and low unemployment,” Skriver said.

“Additionally, 2021 saw a positive trend on the stock market. That has benefited pension yields,” he said.

Low national debt means Denmark is better equipped to cope with an economic crisis than comparable countries, he said.

“A downturn will place a dampener on incomes and also make expenses increase for things like unemployment benefits,” Skiver said.

“This lower debt means we are better equipped,” he said.

READ ALSO: Danish economy predicted to have tough 2023 in OECD report

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