A bridge from continental Europe to Scandinavia that is sceptical about the EU
Denmark is one of Europe's more physically fragmented countries. The largest part, with around 70% of the territory of Denmark itself, is the Jutland peninsula. To the east of this lie the two largest of Denmark's 400 or so islands: Funen and Zealand; the capital, Copenhagen, is located on the east of Zealand. In addition, Denmark has two distant dependent states—Greenland and the Faroe Islands. Most of Denmark itself is low-lying and fertile, broken occasionally by hills, particularly in the centre and east of Jutland.
Denmark's population is ethnically fairly homogenous, though flows of immigrant workers from the 1970s, and asylum-seekers during the 1980s and 1990s, added variety. Around 5% of the population are foreign-born, with the largest numbers coming from former Yugoslavia and Turkey.
The standard of living is high and the government gives a high priority to education, on which it spends 9% of GDP, one of the highest proportions in Europe. Danes also enjoy free medical care and extensive welfare benefits. Although public provision is not as generous as in other Nordic countries, social welfare spending is equivalent to more than one-quarter of GDP. Income tax rates touch 60% and there is a flat VAT rate of 25%. Poverty levels are among the lowest in Europe.
Even so, it is doubtful that the Danish welfare state will survive in its current form, given the ageing population. The arrival of immigrants rejuvenated the population somewhat but a falling birth rate is still leading to a rising proportion of older people. In the next 30 years the ratio of working people to those over 60 years old will fall from 3.0 to 2.1. A new Welfare Agreement agreed in 2006 incorporates raising the age of retirement
Agriculture accounts for only around 3% of GDP, but is still vital to the economy, since it feeds into industry and exports. Two-thirds of Denmark is used for crops or pasture. Most activity is concerned with livestock—either growing animal feed or raising cattle and pigs. Farms are small and family-owned but technologically very sophisticated. Since they produce around three times Denmark's own requirements, they export most of their output. Denmark also has a major fishing fleet, though over-fishing and controls by the EU have been constraining output.
Denmark is the home of Carlsberg and Lego
Agriculture provides important raw materials for Danish industry—some of the cereal crop finishes up, for example, in cans of Carlsberg beer, one of the world's most venerable brands. Other distinctive Danish exports include stylish furniture, the hi-fi equipment of Bang & Olufsen, and the ubiquitous plastic Lego bricks—which have also been used in the construction of Legoland, one of Europe's largest theme parks.
Apart from its soil, Denmark has limited natural resources. It does not have much coal or many minerals, but oil and gas fields in the North Sea supply the bulk of local needs. With a lot of flat and exposed land, Denmark can also generate a significant amount of wind power.