Greek election could have serious economic consequences in Denmark

Housing and job markets could suffer if Greeks decide to drop austerity plan and default on loans

The popular, left-leaning Syriza party says that should it win the Greek election scheduled for next month, it will drop the strict austerity policy that the EU has imposed on the country. That change in policy could have a serious impact throughout Europe, including Denmark.

“Growth in Europe will suffer,” Henrik Drusebjerg, a chief economist with Carnegie investment bank told DR Nyheder. “Denmark has a small, open economy and we would feel the effects right away.”

The Eurosceptic party Syriza has been beating the drum for Greece to stop repaying billions of Euros worth of debts owed to the European Commission, the European Central Bank and the International Monetary Fund (IMF). 

Germany the key
Polls suggest that Greece will elect left-leaning government with Syriza in the lead. 

If the polls are accurate and a new government decides not to pay back the loans, Denmark will feel the pinch when major trading partners like Germany scale back growth, making it harder to sell Danish products across the border.

READ MORE: Danish ministers satisfied with Greek bailout

“The eurozone economy is very fragile, so should the Germans slow the pace even a little bit, we will feel it here in Denmark,” said Drusebjerg. “It will mean that we have to downgrade growth and that will hit the housing market hard and unemployment will go up.”