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Could Denmark split with Sweden over PostNord postal service?

The Danish Ministry of Transport is to look into the consequences of withdrawing Denmark from PostNord, the postal service it co-owns with Sweden.

Could Denmark split with Sweden over PostNord postal service?
Photo: Philip Davali/Ritzau Scanpix

Several political parties favour withdrawing Denmark completely from the Danish-Swedish postal company, newspaper Jyllands-Posten reports.

The Danish People's Party, the Liberals, the Conservatives and the Social Liberal party all see benefits in leaving the cooperation, according to the report.

A final decision by the parties is pending further consideration, however. The Ministry is to make an assessment no later than March.

The Swedish government has meanwhile announced it will launch an inquiry to look into the postal system by early spring.

Hans Kristian Skibby, the Danish People's Party’s spokesperson for post, said he would prefer a purely Danish company to operate the country’s post.

“Hopefully we can have a happy divorce with PostNord in Sweden,” Skibby said.

The Danish government owns 40 percent of PostNord, with 60 percent owned by its counterpart in Stockholm.

The company has faced sharp criticism on several occasions since it began announcing losses in 2012.

Inefficient mail distribution and poor financial management have been among the criticisms.

But pulling Denmark out of PostNord would be as expensive exercise, according to says Per Nikolaj Bukh, a professor of business economics at Aalborg University.

“Costs for separation would be in the 100-million-kroner class,” Bukh said.

Neither would such a move solve the issues with Denmark’s postal service, according to the professor.

“The Danish part of the postal service will not become more efficient by splitting it up,” he said.

One concern amongst the Danish political parties is that the financial situation in the Swedish part of PostNord will come under increasing pressure in the future due to digitalization. That could result in a negative impact on Danish state finances, given the current joint ownership.

But Denmark cannot simply run away from the bill, Bukh said.

“Experience with the Swedes tells us that the matter can be viewed in different ways. Sweden is not just going to let Denmark make off with the benefits,” he said.

Skibby claimed that Denmark has paid its share in the form of bailouts to PostNord.

“We cannot go blindly into a partnership in which we take on some of Sweden’s financial burdens,” he said.

PostNord continues to make a loss but came increasingly close to breaking even in Denmark in 2019.

The company has also cut deliveries, raised prices and closed virtually all of Denmark's post offices over the last decade, replacing them with counters in supermarkets and convenience stores.

The Danish and Swedish states injected funds to assist the company during the 2018 cost-cutting programme.

An EU commission opened in June 2019 will investigate whether state support of around two billion kroner from Denmark and Sweden breached EU rules.

READ ALSO: Danish postal service continues to lose money, but closer to breaking even

Member comments

  1. My experience living in Copenhagen has been extremely positive with one exception . The postal system . I have never had such a poor experience. Post Nord refused to deliver parcels to my address but instead left them at various locations in Copenhagen . In most cases they did not even try to deliver . After multiple calls to them waiting up to 25 mins on hold. Their response was that they did not know why parcels were not being delivered? Amazon manage to do it .
    Letters sent back to the UK would take weeks to arrive and a parcel I sent to the US took 2 months ! Notwithstanding COVID and the pressures on all of us in our jobs . Postnord is really below par in comparison with other national postal services .

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PostNord to continue Danish deliveries until 2023

The Danish arm of Swedish-Danish post distribution company PostNord is to continue delivering the country’s post until at least 2023 after a new deal was agreed with the government.

PostNord to continue Danish deliveries until 2023
PostNord will deliver Denmark's letters until at least 2023. Photo: Mads Claus Rasmussen/Ritzau Scanpix

Post Danmark – the Danish subsidiary of PostNord – extended its contract to deliver post in the country with the government and its allied left wing parties, the transport ministry confirmed in a statement on Monday.

“Distributions of post is an important societal task which every sitting government must take responsibility for,” transport minister Benny Engelbrecht said in the statement.

A “large proportion” of people in Denmark still “do not receive their post digitally and therefore need to receive their post at their home address,” Engelbrecht said.

“It must be possible to receive a letter from your family and to write to your family, regardless of where in the country you live.

“That’s why the deal with Post Danmark has been extended, so Danes can be reassured that post will get through while political work to secure a new, long-term postal agreement continues,” the minister said.

The Danish government owns 40 percent of PostNord, with 60 percent owned by its counterpart in Stockholm.

The company has faced sharp criticism on several occasions since it began announcing losses in 2012. The Danish state has spent to keep the Danish side of the company afloat. Inefficient mail distribution and poor financial management have been among the criticisms.

PostNord was established in 2009 via a merger of the formerly-national Post Danmark and Sweden’s Posten.

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