Denmark cuts economic forecast amid lower pharma export growth

Denmark’s government expects the economy will expand 1.9% this year, cutting a previous forecast amid lower pharmaceutical export growth.

The economy ministry cut its 2024 gross domestic product growth forecast from a May estimate of 2.7%. In 2025, GDP is expected to rise 2.2%, up from 1.8% seen previously.

It comes as the government significantly lowered its expectations for export growth, now forecasting a 2.5% rise this year. This is down from a previous forecast of 7%, and from 10.4% recorded in 2023.

“The same progress in exports can’t be expected as in recent years, when exports of medicinal products have grown particularly strongly,” the ministry said in its latest economic review.

Pharmaceuticals and raw material extraction are still expected to be key drivers of Danish economic growth this year, the ministry said. Without these two industries, Denmark’s GDP would rise 1.3% in 2024, and 1.2% in 2025.

Denmark’s flourishing drugmaking industry, mostly known for Novo Nordisk’s popular weight-loss drugs and Bavarian Nordic A/S’s mpox vaccine, was responsible for half of the economy’s expansion last year when Denmark was one of the fastest growing in western Europe.

Denmark’s inflation rate is expected at 1.8% this year, lower than the government’s May estimate of 2.1%. In 2025, the rate will land at 2%. Meanwhile, house prices will increase 2.7% in 2024, compared with 3.2% estimated previously, and will increase by 3% in 2025, the ministry said.

Late Thursday, the government also said it expects a higher financing need next year.