Denmark – Technology Performance Digest

Executive Summary

This report provides a comprehensive assessment of Denmark’s current performance and future trajectory in two key dual-use technology domains: biodegradable-plastics and quantum-key-distribution. The analysis focuses on the contributions of leading Danish organisations, notably Sparrow Quantum and the University of Copenhagen, and evaluates national strengths, weaknesses, investment patterns, and Denmark’s position in the global competitive landscape as of June 2025.

Denmark demonstrates significant promise in both technology areas, leveraging a robust research ecosystem, strong public-private partnerships, and a strategic orientation towards sustainability and digital security. In biodegradable-plastics, Denmark benefits from its advanced materials science sector and environmental policy leadership. In quantum-key-distribution, the country is distinguished by pioneering research, particularly through Sparrow Quantum and the University of Copenhagen, positioning Denmark as a European innovator in quantum communications.

However, Denmark faces challenges including scale limitations, talent retention, and the need for continued investment to maintain technological leadership. The next five years will be critical as Denmark seeks to translate research excellence into industrial and defence applications, expand export markets, and mitigate emerging risks.

Strengths

Biodegradable-Plastics

• Research Excellence: Danish universities, notably the University of Copenhagen, are recognised for high-impact publications and patents in polymer chemistry and sustainable materials. Collaborative research projects with European partners further amplify this strength.
• Policy Alignment: Denmark’s ambitious environmental policies and circular economy initiatives provide a supportive framework for the development and deployment of biodegradable-plastics. National regulations incentivise both public and private sector adoption.
• Industrial Base: Denmark’s established chemical and biotech sectors, with companies such as Novozymes and Carlsberg, facilitate technology transfer and scale-up of new materials, including biodegradable alternatives.
• Public Awareness: High societal awareness of environmental issues drives consumer and corporate demand for sustainable materials, accelerating market uptake.

Quantum-Key-Distribution

• Pioneering Research: Sparrow Quantum and the University of Copenhagen are at the forefront of quantum photonics and quantum communications. Their work on single-photon sources and entanglement-based protocols underpins advances in quantum-key-distribution.
• Integration with European Initiatives: Denmark is an active participant in EU quantum flagship programmes, securing access to funding, infrastructure, and collaborative networks.
• Skilled Workforce: A strong pipeline of quantum physicists, engineers, and computer scientists is cultivated through Danish universities, with targeted graduate programmes and international recruitment.
• Start-up Ecosystem: The presence of innovative start-ups such as Sparrow Quantum fosters agility and rapid prototyping, bridging the gap between academic research and commercial/defence applications.

Weaknesses

Biodegradable-Plastics

• Scale Limitations: Despite research leadership, Denmark’s domestic market and manufacturing capacity are modest compared to larger European economies, constraining economies of scale.
• Cost Competitiveness: Production costs for biodegradable-plastics remain higher than for conventional plastics, limiting competitiveness in price-sensitive markets.
• Feedstock Supply: Limited domestic availability of sustainable biomass feedstocks can hinder large-scale production and increase reliance on imports.
• Fragmented Value Chain: The transition from laboratory innovation to industrial application is slowed by fragmentation among research institutions, start-ups, and established manufacturers.

Quantum-Key-Distribution

• Infrastructure Gaps: Denmark’s national quantum communication infrastructure is in early stages, with limited deployment beyond pilot projects and research testbeds.
• Commercialisation Challenges: While research is world-class, the translation to scalable, market-ready quantum-key-distribution solutions is ongoing, with limited Danish presence among global commercial leaders.
• Talent Retention: Competition for quantum technology talent is intense, with risk of brain drain to larger, better-funded ecosystems in the US, UK, and Germany.
• Defence Integration: Integration of quantum technologies into national defence and critical infrastructure is at a nascent stage, requiring further investment and policy coordination.

Notable Programmes & Investments

Biodegradable-Plastics

• Green Plastics Partnership: Led by the University of Copenhagen, this public-private consortium advances research on next-generation biodegradable-plastics, focusing on marine degradability and industrial compostability. Funded by Innovation Fund Denmark and EU Horizon Europe.
• Circular Denmark Initiative: A national strategy that allocates €100 million (2022–2027) to support circular economy projects, including R&D and pilot deployment of biodegradable materials in packaging, agriculture, and defence logistics.
• Industrial Demonstrators: Collaboration between Danish biotech firms and packaging manufacturers to pilot biodegradable films and containers for food, medical, and military applications.

Quantum-Key-Distribution

• Quantum Denmark: A €60 million national programme (2023–2028) supporting quantum technology research, infrastructure, and start-up incubation. Sparrow Quantum and the University of Copenhagen are key beneficiaries.
• EU Quantum Flagship Projects: Danish entities participate in pan-European projects such as OpenQKD and Quantum Internet Alliance, focusing on cross-border quantum-key-distribution testbeds and interoperability.
• Defence Pilot Projects: The Danish Defence Intelligence Service, in partnership with the University of Copenhagen, is conducting pilot deployments of quantum-secure communication links for critical infrastructure and government networks.
• Venture Investment: Sparrow Quantum has secured multiple funding rounds from Danish and European venture capital firms, enabling rapid prototyping and international partnerships.

Competitive Comparison

Biodegradable-Plastics

• Europe: Denmark is a research leader but lags behind Germany, the Netherlands, and Italy in large-scale production and export of biodegradable-plastics. These countries benefit from larger domestic markets and vertically integrated chemical industries.
• Global: The US, China, and Japan dominate global patent filings and industrial output. Denmark’s niche lies in high-performance, specialty biodegradable materials, particularly for medical and defence applications.
• Defence Sector: Denmark is ahead of most Nordic peers in integrating biodegradable materials into military supply chains, but trails larger NATO members in procurement scale.

Quantum-Key-Distribution

• Europe: Denmark is among the top five European countries in quantum communications research, alongside Germany, France, the Netherlands, and the UK. However, Germany and the UK have more advanced commercial deployments and larger national investments.
• Global: The US and China lead in both research and commercialisation of quantum-key-distribution, with extensive government funding and state-backed industrial consortia. Denmark’s strength is in foundational research and niche photonic technologies.
• Start-up Ecosystem: Sparrow Quantum is recognised as a European leader in single-photon source technology, though faces competition from start-ups in Switzerland, the UK, and Canada.

Opportunities for Collaboration / Export

Biodegradable-Plastics

• European Defence Procurement: Denmark can expand exports of biodegradable packaging and logistics materials to NATO partners seeking to reduce environmental impact of military operations.
• Nordic Collaboration: Joint R&D and standardisation efforts with Sweden, Norway, and Finland can accelerate regional adoption and create a unified Nordic market for biodegradable-plastics.
• Global Niche Markets: High-performance biodegradable materials for medical, aerospace, and defence applications present export opportunities, leveraging Denmark’s reputation for quality and environmental stewardship.
• EU Green Deal: Participation in EU-funded projects can facilitate technology transfer and market access across Europe.

Quantum-Key-Distribution

• Cross-Border Quantum Networks: Collaboration with Germany, Sweden, and the Netherlands on quantum communication infrastructure can position Denmark as a regional hub for secure data exchange.
• Defence Alliances: Joint development and deployment of quantum-key-distribution systems with NATO and EU partners can enhance collective cyber resilience and open export channels for Danish technology.
• Academic-Industrial Partnerships: Leveraging the expertise of the University of Copenhagen and Sparrow Quantum in international consortia can attract foreign investment and talent.
• Commercial Licensing: Danish innovations in single-photon sources and quantum cryptography protocols can be licensed to global telecom and cybersecurity firms.

Risks & Mitigation

Biodegradable-Plastics

• Market Volatility: Fluctuations in oil prices and regulatory changes can affect demand for biodegradable-plastics. Mitigation: Diversify product applications and secure long-term contracts with public sector and defence clients.
• Technological Obsolescence: Rapid advances in alternative materials (e.g., advanced recycling, bio-based composites) could erode market share. Mitigation: Maintain R&D investment and monitor emerging technologies.
• Supply Chain Disruptions: Dependence on imported feedstocks exposes Danish producers to geopolitical and logistical risks. Mitigation: Invest in domestic biomass production and diversify supplier base.
• Regulatory Fragmentation: Divergent standards across EU and global markets may hinder export growth. Mitigation: Engage in international standard-setting and harmonisation efforts.

Quantum-Key-Distribution

• Cybersecurity Threats: Advances in quantum hacking or side-channel attacks could undermine trust in quantum-key-distribution systems. Mitigation: Continuous security testing and participation in international cryptography standards bodies.
• Talent Drain: Loss of key researchers to foreign institutions or industry could slow innovation. Mitigation: Enhance incentives, career development, and international collaboration opportunities for quantum talent.
• Funding Gaps: Potential reduction in public or EU funding could stall infrastructure projects. Mitigation: Foster private investment and diversify funding sources.
• Technology Export Controls: Stricter export controls on quantum technologies may limit international collaboration and market access. Mitigation: Proactive engagement with regulators and compliance with international frameworks.

Outlook (5-year)

Biodegradable-Plastics

Denmark is expected to consolidate its position as a European leader in research and high-value applications of biodegradable-plastics. Over the next five years, increased investment in pilot-scale manufacturing, public procurement, and cross-sector partnerships will drive the transition from laboratory innovation to commercial deployment. Denmark’s focus on circular economy principles and environmental leadership will support export growth, particularly in niche markets such as defence logistics, medical devices, and specialty packaging.

However, Denmark will need to address scale and cost barriers to compete with larger producers. Continued participation in EU programmes and Nordic collaborations will be vital for market expansion and standardisation. By 2030, Denmark could emerge as a key supplier of advanced biodegradable materials for high-performance and regulated applications, provided it sustains R&D momentum and industrial investment.

Quantum-Key-Distribution

Denmark’s trajectory in quantum-key-distribution is highly promising but contingent on sustained investment and infrastructure development. The next five years will see the maturation of national and cross-border quantum communication networks, with Danish research institutions and start-ups playing pivotal roles in technology development and standard-setting.

Sparrow Quantum and the University of Copenhagen are well-positioned to lead in photonic quantum technologies, with potential for commercial breakthroughs in single-photon sources and integrated quantum cryptography solutions. Defence and critical infrastructure applications will expand, supported by pilot projects and EU collaboration.

To maintain competitiveness, Denmark must address talent retention, accelerate commercialisation, and deepen integration with European and NATO quantum initiatives. By 2030, Denmark could be recognised as a regional hub for quantum-secure communications and a key contributor to the European quantum technology ecosystem.

Conclusion:
Denmark’s dual-use technology landscape in biodegradable-plastics and quantum-key-distribution is marked by research excellence, strategic policy alignment, and a vibrant innovation ecosystem. While challenges remain in scaling, commercialisation, and talent retention, Denmark’s commitment to sustainability and digital security, coupled with strong institutional actors such as Sparrow Quantum and the University of Copenhagen, positions the country for continued leadership and export growth in these critical technology domains.