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.
Denmark’s aid performance
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.
Denmark’s trade performance
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
- High agricultural subsidies (equivalent to a tariff worth 15.4% of the value of imports; rank: 25)
|
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.
Denmark’s investment performance
Strengths
- Employs foreign tax credits to prevent double taxation of corporate profits earned abroad
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 home.
Denmark’s migration performance
Strengths
- Large increase during the 1990s in the number of unskilled immigrants from developing countries living in Denmark (rank by share of population: 7)
Weaknesses
- Small share of foreign students from developing countries (50%; rank: 19)
- Tuition for foreign students higher than for nationals
|
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.
Denmark’s environment performance
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, rewards military protection of global sea lanes, and penalizes arms exports to poor and undemocratic governments.
Denmark’s security performance
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
|
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.
Denmark’s technology performance
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
|
