Denmark is a small, open economy, and hence is highly sensitive to international market trends. During the 1960's the Danish economy was transformed from being highly dependent on agriculture to an economy based primarily on industry and services. Denmark became a member of the European Community in 1973 but continued actively to take part in Nordic co-operation. The removal of barriers to goods, services and capital within the European co-operation has led to a remarkable adjustment process of the Danish economy.

Denmark has an attractive investment climate. We have modest corporate taxes and a well-functioning infrastructure. Our labour force is skilled and the number of working days lost is small compared to other countries.

Let me focus on more recent developments and the prospects for the years ahead. After seven years of sluggish growth, the Danish economy has in recent years moved towards a clearly better macroeconomic balance. Price and wage increases remain low. The deficit on the external current account, earlier an almost chronic problem, was eliminated in 1990 and there is now a comfortable surplus.

Compared to other industrialized countries the Danish public sector deficit is relatively small and it is still decreasing. It is the aim of the Goverment to balance the public budget in 1997. According to estimates by the European Commission, Denmark will have one of the best performances of public sector finances in the Union in 1997.

To combat unemployment remains one of the high priority areas of government. International co-operation, a flexible labour market and stable economic developments are important preconditions for increasing employment.

Denmark has worked intensively with its Nordic partners to put unemployment high on the international agenda. Domestically, labour market policies have undergone substantial changes in order to make the labour market more flexible and to increase the skills of the labour force. Economic policies are aiming at a sustainable non-inflationary growth, with public finances under control and a stable rate vis-a-vis the other core members of the European Exchange Rate Mechanism.

Mrs. Marianne Jelved