Denmark: Staff Report for the 2018 Article IV Consultation—Informational Annex

2018 Article IV Consultation-Press Release and Staff Report

Abstract

2018 Article IV Consultation-Press Release and Staff Report

Fund Relations

As of April 30, 2018

Membership Status: Joined: March 30, 1946; Article VIII.

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Outstanding Purchases and Loans: None

Latest Financial Arrangements: None

Projected Payments to Fund1

(SDR Million; based on existing use of resources and present holdings of SDRs):

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Exchange Arrangements: Denmark participates in the European Exchange Rate Mechanism II (ERMII) with a central rate at DKr 746.038 per 100 euro. The standard width of the fluctuation band in ERM II is +/-15 percent. However, due to its high degree of convergence, Denmark has entered into an agreement with the European Central Bank (ECB) and the euro area member states on a narrower fluctuation band of +/- 2.25 percent. This means that the krone can only fluctuate between DKr 762.824 per 100 euro and DKr 729.252 per 100 euro.

Denmark has accepted the obligations of Article VIII, Sections 2(a), 3, and 4 and maintains an exchange system free of restrictions on payments and transfers for current international transactions, apart from those imposed solely for the preservation of national or international security, as notified to the Fund by the National Bank of Denmark in accordance with Executive Board Decision No. 144-(52/51).

Article IV Consultation: The last Article IV consultation was concluded by the Executive Board on June 16, 2017. The staff report (IMF Country Report No. 17/158) was published with Press Release No. 17/234 (June 20, 2017).

Outreach: The team met with representatives of the private sector, labor and financial institutions.

Press conference: The mission held a press conference after the concluding meeting on May 16, 2018.

Publication: The staff report will be published.

Technical Assistance: None.

Resident Representative: None.

Statistical Issues

Data Provision is adequate for surveillance. The country has a full range of statistical publications, many of which are on the internet. The quality and timeliness of the economic database are generally very good. The country subscribes to the Fund’s Special Data Dissemination Plus Standard. Metadata are posted on the Dissemination Standards Bulletin Board.

National Accounts: Denmark adopted the European System of Accounts 2010 (ESA 2010) in September 2014. Parallel to the transition to the new international guidelines, a revision of data and methods has been carried out as well, improving the quality of the statistics. Historical data were revised going back to the initial year of 1966.

Government Finance Statistics: Starting from September 2014, government finance statistics data is based on the ESA 2010 methodology, which includes revisions of the general government deficit and debt levels from 1995 onwards. Revised data series was published in October 2014.

External Statistics: Starting in 2014, external sector statistics are compiled according to the Balance of Payments and International Investment Position Manual, sixth edition (BPM6) and in accordance with legal requirements of the ECB and Eurostat.

Monetary and Financial Statistics: Monetary data reported for International Financial Statistics are based on the European Central Bank’s (ECB) framework for collecting, compiling, and reporting monetary data. The data are reported to STA through the ECB and largely accords to the Monetary and Financial Statistics Manual and Compilation Guide (MFSMCG).

Table 1.

Denmark: Common Indicators Required for Surveillance

(As of May 23, 2018)

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Any reserve assets that are pledged or otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the notional values of financial derivatives to pay and to receive foreign currency, including those linked to a foreign currency but settled by other means.

Both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds.

Foreign, domestic bank, and domestic nonbank financing.

The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.

Including currency and maturity composition.

Includes external gross financial asset and liability positions vis-à-vis nonresidents.

Daily (D), weekly (W), monthly (M), quarterly (Q), annual (A), irregular (I); and not available (NA).

Starting with data for 2014, external sector statistics are compiled according to the sixth edition of the Balance of Payments and International Investment Position Manual (BPM6) and in accordance with legal requirements of the ECB and Eurostat.

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When a member has overdue financial obligations outstanding for more than three months, the amount of such arrears will be shown in this section.

Denmark: 2018 Article IV Consultation-Press Release and Staff Report
Author: International Monetary Fund. European Dept.