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“The most successful companies reacted faster than their competitors, and they implemented quick but also cautious and moderate saving plans."

 

olaf valentin kjær, pa business transformation expert

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Reforms alone will not strengthen Denmark’s competitiveness

Lower personal taxes, increased digitalization and a changed mindset will bring Denmark back on track, according to chairman of the Liberals Lars Løkke Rasmussen, who was guest speaker at PA Consulting Group’s Executive Seminar in Copenhagen on June 13.

“I just returned from a trip to South Korea, where the government has introduced a new law that forbids teaching of school children after 10 pm. So, it’s undeniably interesting to return to Denmark to find out that one of the Liberals’ sister parties suggest a ban of homework assistance after 1 pm,” said Lars Løkke Rasmussen, suggesting that school children will not suffer from a heavier intellectual pressure in order to increase Denmark’s competitive position in the long run.

”Denmark’s overall costs are too high, and introducing new reforms are not enough to change this development. Reforms are one step in the right direction, however, figures show that we are facing even more problems: Export is too low, we are not able to attract investments from abroad, entrepreneur activities are disappointingly low, and our own investments are too small,” said senior partner Gorm Lykke Østergaard, PA Consulting Group.

Increased focus on growth

According to an analysis carried out by PA Consulting Group, the economic incentive to work is not strong enough, and Lars Løkke Rasmussen agrees:

“Introducing new reforms doesn’t mean that an upturn is just around the corner. The fact is that Denmark’s competitive situation is under pressure. We have earmarked DKK 92 billion to increase growth; however, with a public expenditure of DKK 4,352 billion, this number is quite small. That is why I am focusing on putting a stop to the tax burden on the Danish business community and to introduce lower personal taxes,” said Lars Løkke Rasmussen.

“We also need to discuss public expenditure as well as the very complex social model that is Denmark. With all the regulations, it is almost impossible to set a new direction for Denmark. Let me exemplify: Recently, I paid a visit to a tomato garden centre that is about to invest DKK 60 million in 40 new workspaces. The problem is that the investment will take place in Sweden, not in Denmark. The reason is that Sweden has far more gentle environmental regulations. My point is that if Sweden is able to attract this kind of operation, there must be something seriously wrong with the Danish rules and business terms,” said Lars Løkke Rasmussen.

Lars Løkke Rasmussen suggests that Denmark learns from our neighbor countries, such as Sweden. Gorm Lykke Østergaard adds that this combined with lower personal taxes and a lower public expenditure will pave the way for a more successful Denmark.


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