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28 Oct 2020 – Insights

Much at stake for Denmark in US presidential election

The US is now Denmark’s biggest export market ahead of Germany, and much is at stake for Denmark and Danish export industries at next week’s US presidential election.

Following declining Danish exports to Germany since the onset of the corona crisis, the US has emerged as Denmark’s biggest and most import export market, making the fall out of next week’s US presidential election all the more important for Denmark, its economy and its export industries.

Much is at stake and some election outcomes will be more beneficial for Denmark than others, says analyst at Danske Bank, Bjørn Tangaa Sillemann. 



”If Joe Biden is elected president and the democrats claims a majority in Congress, we could see a massive fiscal boosting of the US economy, which would have spill over effects around the world. For Denmark a best case would probably be if democrats win the election and the worst case would be a divided congress with republicans controlling the senate and democrats winning the house of representatives”, says Bjørn Tangaa Sillemann. 

Divided congress
Both Biden and Trump will want to boost the economy, Biden through investments and increased public spending and Trump through tax cuts, and although the different measures will have different outcomes, both will boost the economy in a way that would have spill over effects for the rest for the world 

But a divided congress would make it difficult for either of them to get a deal through and we could end up with no fiscal stimuli at all, says Bjørn Tangaa Sillemann. 

If Joe Biden is elected president and the democrats claims a majority in Congress, we could see a massive fiscal boosting of the US economy, which would have spill over effects around the world. 

Bjørn Tangaa Sillemann

Analyst, Danske Bank


"Joe Biden as president would make closer trade ties between the US and the EU more likely. Both Biden and Trump would want to make the US less depended on China but it was Trump who started the trade tensions with the EU and called off the negotiations on the transatlantic trade agreement”, says Bjørn Tangaa Sillemann, adding that a Biden presidency would come with challenges of its own. 
 
Medicine pricing
Pharmaceuticals make up the lion’s part of Danish export to the US, and medicine prices is a political issue which both candidates have proclaimed to address. And in this respect, it is Biden who is the more aggressive. 

”Biden has more radical ambitions than Trump on medicine prises, which would be bad news for the Danish pharmaceutical industry. Securing lower prices on medicines have proved difficult, though. Trump has tried in vain several times and Biden’ would be hard pressed to secure backing for his more aggressive plans”, says Bjørn Tangaa Sillemann.