Country_12_Denmark_EN

Denmark

Commitment to Development Index 2012

Denmark David Roodman and Julia Clark

The Commitment to Development Index (CDI) ranks 27 of the world’s richest countries based on their dedication to policies that benefit poor nations. Looking beyond standard comparisons of foreign aid flows, the CDI measures national policies in seven areas that are important to developing countries: aid, trade, investment, migration, environment, security and technology. This report reviews Denmark’s performance on the 2012 CDI. For more details, visit cgdev.org/cdi.

Denmark Norway Sweden Luxembourg Austria Netherlands Finland New Zealand United Kingdom Portugal Canada Germany Belgium France Spain Australia Ireland Switzerland United States Italy Greece Hungary Slovakia Czech Republic Poland Japan South Korea

Overall Score

Denmark’s 2012 CDI Performance n Overall rank 2012: 1 n Overall score 2012: 7.0 n Change since 2003: -0.2 (using 2012 methodology) Denmark ranks 1 overall in 2012.

Denmark gives a large quantity of high-quality foreign aid, contributes a significant amount of personnel and finance to international peacekeeping and humanitarian interventions, and encourages research and development.

Denmark’s performance is, however, somewhat negatively affected by its barriers against agricultural imports from developing countries, its lack of policies that promote productive investment in poor countries, and its high fossil fuel production per capita.

Denmark’s CDI Performance, 2003–12 2003

Aid

2012

Trade Investment

st

Migration Environment Security Technology Overall

0

www.cgdev.org/cdi

4

8

12

16

Denmark Country Report

Aid

Aid quality is just as important as aid quantity, so the CDI measures gross aid as a share of GDP adjusted for various quality factors: it subtracts debt service, penalizes “tied” aid that makes recipients spend aid only on donor goods and services, rewards aid to poor but relatively well-governed recipients, and penalizes overloading poor governments with many small projects.

n Score: 11.5 n Rank: 4

Investment

Rich-country investment in poorer countries can transfer technologies, upgrade management and create jobs. The CDI includes a checklist of policies that support healthy investment in developing countries.

n Score: 4.7 n Rank: 18 Strengths - Employs foreign tax credits to prevent double taxation of corporate profits earned abroad

Strengths - Very high net aid volume as a share of the economy (0.91%; rank: 4) - Large share of aid to poor and relatively well-governed recipients (selectivity rank: 4) - Prevents project proliferation; large average project size (rank: 6)

Trade

International trade has been a force for economic development for centuries. The CDI measures trade barriers in rich countries against exports from developing countries.

n Score: 5.3 n Rank: 21 Strengths - Low tariffs on textiles (6.4% of the value of imports; rank: 4) - Low tariffs on apparel (6.4% of the value of imports; rank: 4)

Weaknesses - Political risk insurance also given to inefficient, import-substituting projects - Denies domestic investors the benefits of tax incentives in developing countries - Does not support the Multi-Donor Trust Fund for the Extractive Industries Transparency Initiative

Migration

The movement of people from poor to rich countries provides unskilled immigrants with jobs, income and knowledge. This increases the flow of money sent home by migrants abroad and the transfer of skills when the migrants return.

n Score: 6.2 n Rank: 10 Strengths

Weaknesses - High agricultural subsidies (equivalent to a tariff worth 15.4% of the value of imports; rank: 25)

- The movement of people from poor to rich countries provides unskilled immigrants with jobs, income and knowledge. This increases the flow of money sent home by migrants abroad and the transfer of skills when the migrants return.

Weaknesses - Small share of foreign students from developing countries (50%; rank: 19) - Tuition for foreign students higher than for nationals

Center for Global Development

Denmark Country Report

www.cgdev.org/cdi

Environment

Rich countries use a disproportionate amount of scarce resources, and poor countries are most vulnerable to global warming and ecological deterioration, so the CDI measures the impact of policies on the global climate, fisheries, and biodiversity.

n Score: 6.8 n Rank: 12

Technology

Rich countries contribute to development through the creation and dissemination of new technologies. The CDI captures this by measuring government support for R&D and penalizing strong intellectual property rights regimes that limit the dissemination of new technologies to poor countries.

n Score: 6.6 n Rank: 4

Strengths - Excellent compliance with mandatory reporting requirements under multilateral environmental agreements relating to biodiversity (rank: 1) - Low consumption of ozone-depleting chemicals per capita (rank: 1)

Weaknesses - High greenhouse gas emissions and fossil fuel production rate per capita (11.1 tons of carbon dioxide equivalent; rank: 21) - Low gas taxes ($0.85 per liter; rank: 20) - High fishing subsidies (rank: 20)

Security

Since security is a prerequisite for development, the CDI rewards contributions to internationally sanctioned peacekeeping operations and forcible humanitarian interventions, military protection of global sea lanes, and participation in international security treaties. It also penalizes arms exports to poor and undemocratic governments.

n Score: 7.7 n Rank: 1

Strengths - Significant government support for R&D (rank by share of GDP: 2) - Low share of government R&D expenditure on defense (0.32%; rank: 7) - Provides patent exceptions for research purposes

Weaknesses - Offers patent-like proprietary rights to developers of data compilations, including those assembled from data in the public domain - Imposes strict limitations on anti-circumvention technologies that can defeat encryption of copyrighted digital materials

For More Visit cgdev.org/cdi for the complete 2012 edition of the Commitment to Development Index. There, you can explore the numbers with our interactive graphing tool, view additional publications and background papers, and dive deeper into the CDI methodology by downloading our data and code.

Strengths - Significant financial and personnel contributions to internationally sanctioned peacekeeping and humanitarian interventions over last decade (rank by share of GDP: 3) - Positions naval fleet to protect sea lanes vital for international trade (rank: 5) - Participates in major international security treaties and regimes

Center for Global Development

Denmark Country Report

www.cgdev.org/cdi

Commitment to Development Index 2012 Country Denmark Norway Sweden Luxembourg Austria Netherlands Finland New Zealand United Kingdom Portugal Canada Germany Belgium France Spain Australia Ireland Switzerland United States Italy Greece Hungary Slovakia Czech Republic Poland Japan South Korea

Rank 1 2 3 4 5 6 7 8 9 10 11 11 13 13 15 15 17 18 19 20 21 22 23 24 25 26 27

Aid 11.5 13.0 12.6 13.0 3.1 9.5 6.6 3.3 6.8 3.1 5.0 3.9 6.4 4.2 4.0 4.3 7.5 5.2 3.2 1.3 1.6 0.8 0.8 1.1 0.7 1.6 1.0

Trade 5.3 1.1 5.8 5.3 5.6 5.9 5.8 8.1 5.5 5.6 6.2 5.5 5.5 5.6 5.5 7.4 5.2 1.5 6.7 5.7 5.3 5.4 5.8 5.5 5.6 0.1 -1.3

Investment 4.7 6.1 5.3 4.2 4.8 6.3 5.1 4.3 6.3 5.2 6.1 6.3 5.3 6.1 5.9 6.1 2.9 4.4 5.0 5.4 4.0 3.6 2.9 3.9 4.1 5.2 5.6

Migration 6.2 9.9 7.8 6.8 11.7 5.5 4.4 6.4 4.7 4.0 7.0 6.9 5.0 4.0 5.4 4.2 2.8 8.6 5.2 4.7 6.4 1.7 0.6 1.3 0.6 1.9 1.3

Environment 6.8 3.2 7.3 5.5 6.2 6.7 7.4 6.2 7.2 7.2 2.5 6.9 7.0 6.9 6.4 3.8 6.5 5.8 4.3 6.7 5.9 7.9 8.3 7.2 7.4 4.5 4.2

Security 7.7 7.6 1.2 5.0 6.1 3.2 6.6 7.3 5.4 6.0 5.7 3.7 3.6 3.7 3.4 5.1 6.9 4.4 4.6 5.0 5.7 5.4 5.5 1.6 3.8 4.5 1.4

Technology 6.6 5.7 4.7 4.2 5.7 5.4 5.9 4.8 4.3 7.4 5.5 5.0 4.6 6.6 5.8 5.2 3.9 4.8 4.9 4.2 2.8 3.4 2.6 5.3 2.7 6.1 7.0

Overall Score 7.0 6.6 6.4 6.3 6.2 6.1 6.0 5.8 5.7 5.5 5.4 5.4 5.3 5.3 5.2 5.2 5.1 5.0 4.8 4.7 4.5 4.0 3.8 3.7 3.6 3.4 2.7

Change since 2003 -0.2

+0.7 -0.3

n/a +0.7 -0.1

+0.1 0.0 +0.7 +1.1 +0.3 +0.5 +0.5 +1.0 +0.7 +0.2 0.0 +0.2 +0.8 +0.7 +0.7 n/a n/a n/a n/a +1.3 n/a

The above table lists scores for each of the 27 CDI-ranked countries across seven policy areas. A country’s overall performance is the average of its seven component scores, each of which are scaled so that an average score in 2012 equals 5.0. The final column shows the change in each country’s overall score since the CDI began in 2003 (using 2012 methodology).

About The CDI The Commitment to Development Index has been compiled each year since 2003 by the Center for Global Development (CGD), an independent think tank that works to reduce global poverty and inequality through rigorous research and active engagement with the policy community. CGD senior fellow David Roodman is the chief architect of the CDI, and collaborators have included William R. Cline on trade; Theodore H. Moran on investment; Jeanne Batalova, Kimberly A. Hamilton, and Elizabeth Grieco on migration; Amy Cassara and Daniel Prager on environment; Michael E. O’Hanlon, Adriana Lins de Albuquerque, Mark Stoker and Jason Alderwick on security, and Keith Maskus and Walter Park on technology. The Index is supported by the CDI Consortium.

Center for Global Development

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