After recording weak growth rates in the first half of 2015, the Danish economy deteriorated further in Q3 and GDP contracted for the first time in over two years. The slowdown mainly reflected weakness in exports and government consumption. Recent data show that the economy struggled to gain momentum in Q4 and at the outset of 2016. Indeed, industrial production contracted in November and consumer confidence deteriorated in January. Earlier this month, the government approved several controversial proposals that affect refugees and aim at making the country a less attractive destination. Denmark has also imposed controls on the German border, thus temporarily suspending the Schengen agreement.