A Long-Term Plan for Denmark’s Societal Investments
Project Description
The purpose of the project is to analyze whether Denmark is investing sufficiently to secure future growth and production opportunities, and thereby the prosperity of society, and to identify ways to achieve this.
Investments are crucial for economic growth, innovation, and the development of the capital base. An adequate level of investment stimulates activity and increases future consumption and production possibilities.
The Danish economy is strong by all key measures. The progress in recent years can partly be attributed to reforms that have increased employment and to the significant inflow of foreign labor.
Produktiviteten er derimod kun vokset svagt. Det skyldes bl.a., at den samlede investerede kapital per arbejdet time i økonomien er nogenlunde det samme i dag som i 2010. Det betyder, at vi de sidste 15 år har øget vores produktion ved at øge beskæftigelsen, mens vi ikke har investeret i at gøre den gennemsnitlige medarbejder mere produktiv.
This growth model cannot continue in a situation where the number of people of working age is expected to decline. Therefore, it is necessary to increase productivity. This can be achieved by investing more in automation and digitalization, which can free up labor in both public and private sectors for some of the important tasks ahead.
At the same time, Denmark faces a series of acute and overlapping geopolitical and climate-related challenges that require substantial new investments in defense, green transition, and climate adaptation. These investments must all be initiated within the next 10 years if Denmark is to meet its international obligations, comply with the Climate Act, and avoid further climate damage.
There is a risk that these time-critical investments will crowd out other investments in infrastructure, digitalization, and the development of public and private capital assets. This could become a problem because, for many years, we have not sufficiently prioritized maintaining our public infrastructure and buildings, and much of our existing societal infrastructure is approaching the end of its technical lifespan.
It is therefore essential to create room in the economy to meet this extraordinary need for investments in the coming decades.
Advisory board
Chair
Philipp Schröder
Professor, Aarhus university
Carsten Egeriis
CEO, Danske Bank
Henriette Thygesen
CEO, Terma
Jens Christoffersen
CEO, COWI
Anne Skovbo
CEO, By og Havn
Bjarne Graven Larsen
CEO, Qblue Balanced
Klemens Hjartar
Senior Partner, McKinsey Danmark
Jesper Rangvid
Professor, CBS
Torben Möger Pedersen
Chairman, CIP Foundation
Anders Eldrup
Boardmember, CIP Foundation
Observer
Signe Krogstrup
Director, Denmarks Nationalbank
Observer
Lars Haagen
Deputy Permanent Secretary, Ministry of Finance of Denmark
Solution
The project examines the growing need for investment in Danish society and presents a proposal for an overall plan for Denmark’s societal investments up to 2050. It focuses on both public and private investments that are assessed to be of significant societal importance. More specifically, the purpose is to assess:
- Whether Denmark’s investment level is sufficient to secure future production and consumption opportunities and thereby prosperity in society.
- What scope there is to increase the level of investment without undermining fiscal sustainability.
- What investment needs lie ahead. The focus is on areas where the need for investment is growing significantly, where new investments can deliver substantial societal benefits, or where a lack of investment will have considerable negative consequences.
- How investments are best organised and financed. This is based on a number of concrete investment cases used to analyse how the investments can be implemented, including how they can be organised (privately, publicly, or in partnerships) and which barriers may be present to carrying out the investment.
The results of the project are presented on an ongoing basis through sub-reports and in a comprehensive final report.
Outcome
With the CIP Foundations project, the foundation is being laid for a long-term investment strategy for Denmark, looking beyond 2030. The plan aims to help ensure that in the future we have a sustainable and resilient society with well-functioning infrastructure, creating fertile ground for future growth and prosperity.
A long-term investment plan ensures that we have the necessary physical and digital infrastructure, which is essential for a productive workforce and an efficient society.
The results can be used as inspiration by politicians, civil servants, and other decision-makers when decisions need to be made about future investments in Denmark, and when priorities are set within Denmark’s public sector.