Colliers Denmark Market Report 2024

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COLLIERS MARKET REPORT 2024

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Danish GDP growth driven by the pharmaceutical industry

Prospects of higher growth in Denmark relative to the eurozone

GDP growth is expected to drop from 2.7% in 2022 to 1.7% in 2023. A key reason for this growth reduction is the significant monetary tightening measures by central banks. GDP growth in most European countries is on the brink of stagnation, whereas Denmark is still experienc ing growth. Driven by the pharmaceutical industry, GDP growth in the Danish economy increased by 1.7% from H1 2022 to H1 2023 but saw a 0.3% decline when exclud ing the pharmaceutical industry’s growth contribution. According to Danmarks Nationalbank, the Danish econ omy is not expected to go into a deep recession. Instead, GDP is expected to increase by 1.3% in 2024. Major contributions to GDP growth in 2024 are expected to come from public consumption and the reopening of Denmark’s largest natural gas field, the Tyra field, which before its shutdown in 2019 accounted for around 90% of Danish gas production. Consumer spending rebounding After a decline in 2022, the development in consumer spending turned into a slight increase as 2023 wore on. This increase is due mainly to rising real income and a continued increase in employment. In addition, con sumer confidence has improved significantly since the large declines through 2022, attributable mainly to less uncertainty about energy supply. According to Danmarks Nationalbank, real income is expected to increase by 1% annually until the end of 2025 due to solid wage growth. This means that by 2025, real income will be at the same level as before inflation took off. Consumer spending is expected to end with a slight increase of 0.1% in 2023 and 1.3% in 2024.

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Note: Growth in real GDP (y/y). Source: Eurostat, Statistics Denmark, Danske Bank, Danmarks Nationalbank, Colliers 15 16 17 18 19 20 21 22 E23 E24 Eurozone Denmark

Danish consumer spending expected to rebound

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Note: Growth in real consumer spending (y/y). Source: Eurostat, Statistics Denmark, Danske Bank, Danmarks Nationalbank, Colliers 15 16 17 18 19 20 21 22 E23 E24 Eurozone Denmark