Denmark’s pensions and insurance lobby is proposing that the country’s government set up a “strategic growth team” to come up with proposals for investments, which the pensions sector can then invest in.
Kent Damsgaard, chief executive officer of Insurance & Pension Denmark (IPD), said: “Denmark faces massive investments in our defence and the expansion of renewable energy, climate adaptation and infrastructure.
“There is no doubt that, with the right framework, the industry can be part of the solution – and at the same time ensure a good return for savers,” he said in a statement today.
Such investments could be made directly as well as made via public private partnerships, he said.
“IPD proposes that the government establish a strategic growth team that can contribute to Denmark getting the greatest possible return and social benefit from our investments in the future,” the lobby group said.
In a new analysis document on investment in the pension sector in 2024, IPD said “towering Danish pension savings” were a major reason why the Nordic country’s economic key figures were in top form, with those retirement assets having grown to around DKK4trn (€536bn) since the 1987 Joint Declaration which laid the foundation for the labour-market pensions system.
Pensions assets now amounted to twice the volume of Denmark’s annual GDP, the association said.
Since the pension system was still growing, with contributions exceeding pension payments each year, as well as investment returns that needed to be reinvested, the pensions industry needed to find new investment opportunities, IPD said.
“For an unchanged portfolio composition, this will mean that the pension industry needs to invest more funds across asset classes,” it said in the analysis.
Damsgaard said that when it came to the financial sector, there was a clear political focus on regulation, which he said was fine and understandable.
“But when you think about the enormous positive social significance of Danish pension investments for individual Danes as well as society, it is striking that we don’t have more focus on the framework for those investments,” he said.
“The pensions industry delivers solid returns to savers and large revenues to the treasury, but think what the societal potential would be if politicians focused activley on good growth conditions for Danish investments,” he said.
Returns from Danish investments were fundamentally the same as the country’s exports of goods and services, and were very important for prosperity and well-being in Denmark, said Damsgaard.
“But the world is changing tremendously now, and there’s no doubt it will also become more difficult and more fraught with dilemma to invest and bring prosperity home to Denmark,” he said.
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