Denmarkis a small Scandinavian kingdom and has the lowest level of corruption and one of the highest tax rates in the world. It is also one of the most egalitarian societies in Europe and places securing a worthy living standard for everyone as its top priority. The following interview with Denmark’s Ambassador to Ukraine, Michael Borg-Hansen, is the next instalment in the series of interviews of Scandinavian ambassadors for The Ukrainian Week.
CURRENT AGENDA
U.W.: What is Denmark’s position on the Odyssey Dawn military operation in Libya?
“Our country is involved in this operation which is based on a UN Security Council resolution. Denmark has traditionally been involved in measures of this kind and supports them. It would be good if other countries were also more active in this cause. It is still unclear what this situation, which emerged absolutely unexpectedly in this region, will lead to and how it will develop. Thus, from the viewpoint of military planning and political strategy, this operation is not an ideal scenario. However, in my opinion, we can already say today that a serious threat to the civilian population has been averted. We will see how things develop further. The main demands set in the UN Security Council resolution have been met. So I believe that this operation has been successful.”
U.W.: One of the most burning issues today is nuclear safety. What is your country’s attitude to the growth of nuclear power?
“Like a number of other European countries, our country minimally supports the development of nuclear power. Denmark is a small country, so we try to use other sources of energy. We’re pleased to be a leader in the development of renewable and non-harmful energy sources. Denmark’s economy has grown 70% since 1980, but the level of energy consumption has remained stable since that time. It turns out that this is possible. Over the same period we have also reduced greenhouse emissions.
“The Danish government has passed a resolution this year under which country must be independent of non-renewable sources of energy by 2050. This is a very ambitious plan. We are not going to host or use nuclear power stations. We would like renewable and safe-energy technologies to be one object of our commercial cooperation with Ukraine in the future.”
U.W.: How did the world financial crisis impact the Danish economy? What corrections were made?
“The world economic crisis affected the Danish economy virtually the same as it did any other country. We were forced to cut public spending on the municipal and national levels. Denmark is a highly developed society of universal welfare which is something that is hard to maintain. The cuts I mentioned led to the debate about the increasing number of paid social services, healthcare, education and social security. Of course, this issue is very controversial, but these are the demands of the times. Even the commercial department of our embassy has to charge companies for certain types of services it provides to them. However, there still remains a society in which very few people are rich and at the same time, a mere handful are underprivileged. We are indeed an egalitarian country whose goal is not to leave any of its citizens outside of a worthy human existence. The construction of a powerful system of social security was launched in the 1940s, but it is still hard to afford this system of social security today. We have a very high tax rate, but public opinion polls show that people pay taxes in order to secure social comfort for themselves. This could also be a lesson for Ukraine.”
ON TAXES
U.W.: Given Denmark’s extremely high tax rate – one of the highest in the world – doesn't capital flow abroad?
“The tax rate in our country is very high. But it is not a unique case. Denmark is not much different in this from Sweden, Norway or Finland. There is certain consensus in these countries about paying taxes. Of course, no one likes to pay them anywhere. An anti-tax movement unfolded in Denmark in the 1970s. So we have had our share of conflicts. Our country is a member of the EU which has a comprehensive system of taxation. Tax officials there have access to an extremely wide range of information about circumstances under which people receive their income. For example, Denmark has a system of personal identification numbers. Every employer, bank and insurance company must inform the tax police about his income. If someone tries to move a part of their capital abroad without paying due taxes, he will be caught. We also have an agreement with the EU about preventing such cases. You may think that Danes live in a environment of such strict control over their income and taxes that is inaccessible to other countries, but that’s the price we have to pay for living in a highly developed, socially protected society. And people are aware of it. When you're gravely ill and not rich, you don't have to worry that you will not receive the necessary treatment. You will have it in our society.”
“When I came to Kyiv, I was surprised to see so many cars. In Denmark, we pay 200% and more as car tax. In the streets of Copenhagen, you can see small and old cars. Danes do not feel a need to have the kind of vehicles you see in the streets of Kyiv. Alcohol, tobacco and cars are taxed in Denmark at very high rates.
“Many speak about corruption in Ukraine. First of all, I would like to say that there is virtually no country in the world without corruption. In our country, citizens pay taxes and owing to this have guaranteed access to high-quality free health service – their money is channeled into maintaining medical institutions and providing medical services. In Ukraine, taxes are paid, but hospitals are under-financed. Therefore, citizens are forced to participate in corruption in order to receive medical assistance. In my opinion, your country's biggest problem is corruption in the government sector.”
U.W.: How do high-ranking officials and government employees report their incomes in your country? If someone wants to build a house, do they have to inform society where the money comes from?
“We’re talking about two totally different systems, Danish and Ukrainian. In Denmark, even high-ranking government officials are not paid very much. If one of them decides to buy a house, he will not pay in cash. Cash payments for real estate are a rare thing in Denmark. Danes pay through credit companies and banks. This way it is very easy to see where the money for buying or constructing a piece of property comes from. If there is suddenly a mismatch between declared incomes and the property actually owned by a certain person, an investigation is launched. Cases that occur in Ukraine are simply impossible in Denmark.”
ON (MULTI) CULTURALISM
U.W.: Is Denmark investing money in promoting its culture abroad?
“Our foreign ministry is not very involved in promoting the country's culture abroad. If you compare Denmark's cultural policy with that of France, which is similar to our security policy in terms of scale, you will see that we don't pay much attention to this issue. When we have a good author emerge in the country, the government will help promote him or her abroad, of course. But this is not the main task of the government and taxpayers.
“We are now quite successful in the film industry, which is being financed by the state. Denmark’s Cinema Institute has opportunities to promote our movies abroad. For example, about a month ago Kyiv hosted a small festival of Danish cinema, but not a penny was spent to organize it. We already have an Oscar-winning director – Susanne Bier received the Academy prize for her film In a Better World in 2011. Her work was not featured at the festival I mentioned, because she can very successfully promote her works on her own without any additional help from the government.”
U.W.: Such European countries as Germany and Great Britain recently admitted that their policies of multiculturalism have failed. What is the situation with multiculturalism in Denmark now in light of the recent influx of immigrants?
“If you compare us to larger European countries like as France and Great Britain, which have a long tradition of absorbing other cultures in their colonial past, small Denmark is culturally very homogeneous. Danes belong to one church and have very similar views. We have been importing a labor force since the 1960s and 1970s. Just like larger European countries, we have a series of programs for immigrants. People react if someone refuses to learn our language and does not share our values. Many people now feel that immigrants lack a desire to integrate into Danish society. They do not abide by our written and unwritten laws. In fact, I don't think that in the case of Denmark we can speak about the same multiculturalism as in Great Britain. Our position is such that we cannot accept large groups of people who are not loyal to the country.”
BIOGRAPHICAL NOTE
Michael Borg-Hansen
1951 Born in Brussels, Belgium
1982 Thesis in History and Russian language, Copenhagen University.
1985-92 First Secretary, Embassy Moscow
1989-92 Ministry of Foreign Affairs and Ministry of Defense, Copenhagen
1992-96 Counselor for Political Affairs, Embassy Washington
1996 Representative on NATO's High Level Task Force on conventional arms control
1996-2001 Deputy Director, MFA Security Policy Department
2001-05 Senior Adviser on Foreign Policy, Prime Minister's Office
2005-09 Minister Counselor, Deputy Head of Mission, Royal Danish Embassy, London.
2009-present Ambassador to Ukraine, Georgia and Armenia
