Central Government Debt

The Danish government debt has the highest possible rating (AAA/Aaa) with stable prospects from the largest international credit rating agencies, due to, inter alia, the low debt level and the robust debt structure. At the end of 2021, the Danish central-government debt amounted to kr. 438 billion or 18 per cent of GDP.

A part of the central government debt reflects borrowing on behalf of government-owned companies (on-lending). Adjusted for such on-lending the central government debt amounted to kr. 289 billion, equivalent to 14 per cent of GDP, at the end of 2021.

The central government debt is calculated as the nominal value of domestic and foreign debt less the balance on the central government's account at Danmarks Nationalbank and the assets of the government funds, cf. Table.

Composition of central government debt

Kr. billion, year-end​2021
Domestic debt705
Foreign debt22
Pledging of collateral for swaps 1)​1
​Central government's account at Danmarks Nationalbank-152
Government funds -13
​Bonds to finance social housing​-125
Central-government debt​438
Central-government debt, per cent of GDP18

Note:​ A positive figure indicates a liability; a negative figure indicates an asset. Details may not add due to rounding.

1) Cash collateral for the market value of the swap portfolio. A positive number means the counterparties net have posted collateral.​​

Other public debt measures
The gross general government debt (EMU debt) is often used in international comparisons of sovereign debt. In recent years, the EMU debt has been considerably below the reference value of 60 per cent of GDP in the Stability and Growth Pact. Denmark's EMU debt is estimated by the European Commission to amount to 41 per cent of GDP at the end of 2021. This is low compared with the level in other EU member states. The primary difference between central government debt and EMU debt is that local government debt is included and that bonds to finance social housing and the balance on the central government's account is not offset in the EMU debt.