COPENHAGEN (Reuters) -Denmark sees its economy expanding faster than it previously expected in 2023, mainly thanks to growth in the pharmaceutical industry led by drugmaker Novo Nordisk (NYSE:NVO) and its popular weight-loss drug Wegovy, and due to high employment.
Elsewhere in the economy, the picture was rather bleaker, however.
"Parts of the economy have already slowed down, and there is a decline in industry when excluding the pharmaceutical industry," Economy Minister Jacob Ellemann-Jensen said.
Overall, the government now expects gross domestic product to grow by 1.2% this year compared with its May forecast of 0.6%, the economy ministry said in a report.
Drugmaker Novo Nordisk has seen huge growth with the success of its weight-loss drug Wegovy, which has been flying off store shelves worldwide.
"The pharmaceutical industry, led by Novo Nordisk, has maintained a high production level in the first half of 2023 with June as a new peak," the report said.
But there are still many uncertainties regarding the broader economic outlook, Ellemann-Jensen said in the report.
"Many of our neighbouring countries are currently experiencing stagnation or even regression. The Danish economy is also not avoiding a period of a slower growth pace," he said.
The government still expects Denmark's GDP for 2024 to grow by 1.4% as projected in May.
Inflation in the Nordic country has declined greatly since it reached a 40-year high of 7.7% last year. The government now forecasts inflation at 3.8% this year compared with its May forecast of 4.3%.
Employment is forecast to grow by 32,000 people against 1,000 expected in May, it said.