Turnaround in Denmark.

Denmark has in the last 10 years changed from the ugly duckling to the proud swan of international trade. What used to be a country of high inflation, high interest rates and balance of payment deficits has now developed into a society with the lowest inflation in the western world, an interest

Growth expectations are projected at 2.5 to 3 percent for the years to come, and the Wall Street Journal recently called Denmark's economy "an economic miracle."

The basis for this change has been a solid and steady currency with the European monetary system. Additionally, the Danish government as held labor costs and other industrial expenses lower than those in competing countries.

California's high-technology companies are good prospects for Denmark and other European countries that are pursuing growth-minded U.S. firms. Denmark views California companies as particularly good matches because of similar high-technology strengths and business cultures. For Denmark these strengths are in biotechnology, environmental technology, food processing, medical equipment, telecommunications and electronics. Here are some of the measures the country has taken to position industries in these areas for success in Europe:

In biotechnology, the government provides research and development funding, favorable tax credits, and support for 14 non-profit independent research institutes.

In environmental technology, the country introduced the world's first environmental protection act in 1971. It serves as the model for European Community environmental standards.

In food processing, the country remains a world leader, with many international firms maintaining important facilities there.

In medical equipment, Danish industry is especially strong in diagnostic equipment such as patient-monitoring systems, blood gas analyzers and urological equipment.

In telecommunications, Denmark's strength is reflected in the laying of the first fiber-optic sea cable to Russia for transmitting telephone, video, fax and other digital data.

For many smaller and medium-sized California companies, joint ventures are the preferred method for establishing a presence in Europe. A joint venture provides a solid foundation that allows U.S. companies to assess their products' performance and make any adjustments to be more competitive in the market. As a venture succeeds, the U.S. partner can eventually expand its European production.

One of the most important considerations in choosing a European location is to select a country that provides efficient access to all of Europe. Once a company narrows its choices, it should focus on the countries that match its strengths. Access to Eastern Europe and the independent republics of the former Soviet Union should also be a consideration.

Companies should also consider the internationalism of the business environment of countries they are considering, and the country of choice should also have the necessary infrastructure to support trade. In Denmark, for example, the country's size and location long ago forced the country to focus on commercial training, proficiency in languages and technical skills -- the basics of international trade. Its international orientation is also demonstrated by its balance of payment surplus per capita, which is more than double that of Germany and four times that of Japan.

As part of its effort to attract economic development, the Royal Danish Consulate General can arrange visits for California companies interested in Denmark and introduce them to prospective joint venture partners as well as other international trade facilitators such as bankers, trade associations and accountants. The consulate general also is available to facilitate joint ventures and other arrangements for Danish firms that want to invest in U.S. locations such as California.

L. Reimann is the Consul General of Denmark and is based in Los Angeles at the Royal Danish Consulate General.