Towards a Theory of Internationalization
Elgar original reference
Edited by Léo-Paul Dana, Isabell M. Welpe, Mary Han and Vanessa Ratten
Chapter 11: Internationalization of Danish SMEs
Per Servais, Erik S. Rasmussen, Bo B. Nielsen and Tage Koed Madsen Introduction Denmark is a small, open economy highly dependent on trade with other countries. As foreign trade accounts for most of the gross domestic product (GDP), Denmark has a strong interest in the free exchange of goods and services between countries. Consequently, Denmark has joined economic organizations such as the EU, the UN (Denmark was a cofounder in 1945) OECD and WTO and, within the framework of these, has striven to remove obstacles to free trade. Owing to the lack of natural resources and the limited size of the country (approximately 5 million inhabitants) small ﬁrms and only a very limited number of multinational corporations (MNCs) characterize the Danish manufacturing industry. While Danish companies increasingly operate abroad, just as many foreign companies establish themselves in Denmark. In 2001, net investments by Danish companies abroad thus amounted to DKK 57 billion, while foreign companies invested DKK 40 billion in Denmark. Most of both incoming and outgoing direct investments are in ﬁnancing and business services. Most of the Danish investments abroad are in Europe, while most of the foreign investments in Denmark come from EU countries outside the euro zone. Foreign trade accounts for two-thirds of GDP and around two-thirds of the total foreign trade is with other EU countries. The principal export goods are industrial machinery and instruments, followed by chemical products and industrially processed agricultural products. Consumer goods constitute around 30 per cent of imports, while raw materials...
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