Kristian Jensen: New free trade agreements set the course for the future

2018 was a turbulent year for international free trade with intense negotiations about the UK's exit from the EU and the trade conflict between the USA and China. Europe's trade agreements with the USA have also had a bumpy ride. "Businesses must know that both Denmark and the EU are working hard to de-escalate the current trade conflicts and limit the consequences for Danish and European companies," says Danish Minister for Finance Kristian Jensen, who, together with the government and the EU, is working towards increasing international free trade. 

Where do you see international free trade moving in 2019, not least in the light of Brexit and the accelerating trade war between China and the USA?

International free trade is under pressure, and there is a risk that the current trade conflicts will escalate to the detriment of all parties. At the same time, the insecurity concerning the UK's future links with the EU constitute a significant economic and trade risk.

Danish companies depend on selling their goods internationally, also to the UK, and increased trade barriers will clearly damage us all. I am consequently very satisfied that the EU recently entered into new ambitious free trade agreements with important trading partners such as Canada and Japan, and that more agreements are on their way. This strengthens trade, promotes growth and employment in Denmark and is an important European commitment to increased international free trade. 

The Port of Esbjerg has about 200 companies, many in offshore wind and oil and gas, and there are about 10,000 jobs at the port and in related value chains. In an environment like this, how should you address the uncertainly currently dominating international trade relations?

Businesses must know that both Denmark and the EU must work hard to de-escalate the existing trade conflicts and limit the consequences for Danish and European companies. Regardless of whether some companies can win market share when other suppliers are excluded, trade conflicts are not in Denmark's interests. It is equally important to remember that the nearby markets in Europe still constitute the majority of Danish companies' exports, and the government is working to ensure a well-functioning internal market in the EU.

 "Denmark is highlighted in international contexts as one of the most competitive countries in the world. We wish to maintain that position and must therefore ensure good framework conditions for Danish companies," says Minister for Finance Kristian Jensen in this interview.

 

Should we – and can we – perceive the EU's internal market as a safe harbour?

The internal market is of vital importance to Danish and European growth and job creation. Surveys indicate that since its establishment 25 years ago, the internal market has brought both higher Danish welfare and employment. Denmark's GNP is estimated to be approximately 5 per cent higher (approximately DKK 100 billion a year) as a result of the internal market, and the real wage for an average middle-class married couple is 10 per cent higher (DKK 65,000 annually).

The importance of Danish companies' access to a single market of over 500 million consumers will be more important still when international trade barriers are increased outside Europe. However, it is vital that the internal market continues to develop. This applies in particular to the digital area, so Europe can harvest the full potential from technology and innovative business models to benefit our competitiveness.

USA is an important new market for the offshore wind power industry. What can politicians do to help Danish players in the American markets?

USA is Denmark's third-largest export market, and the most important market outside Europe, and Danish companies are strongly represented in the USA, which promotes growth and employment in both the USA and Denmark. The government is therefore naturally very conscious of ensuring the best possible trade relations with the USA, and we are supporting the ongoing EU negotiations with the USA regarding a mutually improved trade relationship. Finally, Denmark's Trade Council has a strong presence in the USA to assist and advise Danish export companies on becoming established in the American market. 

What do you think about sustainability as a strength in relation to our international trade and Denmark's future prospects?

Sustainability and CSR are important competitive parameters and also the basis for new markets for those, who can deliver the relevant transition, and I expect this trend to increase in the future. It is vital that both citizens and companies assume responsibility and contribute daily to a sustainable development. Fortunately, many companies already appreciate the opportunities and are making a tidy profit from them. Last year, the government launched a new council for CSR and global goals, which will promote good framework conditions for the companies' strategic work in the area.

What do you think are Danish companies' future strengths in terms of international trade?

Denmark has a strong position in the intensifying international competition, and Danish companies have strong positions in a range of areas. As one of the world's leading maritime nations, shipping is a clear example, but also within medicine, energy, food, the climate and water, Danish companies' products and solutions are in high and increasing international demand. Meanwhile, in Denmark we have a relatively highly educated workforce that is ready for change, which is another strength in relation to handling and embracing greater technological change.

Denmark is highlighted in international contexts as one of the most competitive countries in the world. We wish to keep that position and must therefore ensure good framework conditions for Danish companies. The government wants it to be easier and cheaper to run a business in Denmark.

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