Systembolaget, the Swedish state-run alcohol retailer, has seen sales of wine and beer to Norwegians rise, according to figures released today. The retailer sold around 1 billion Swedish crowns' (US$139.8m) worth of alcohol to Norwegians in 2003.

The Norwegian wine and brandy importers' union VBF said that Systembolaget's wine sales in 2003 rose to 6.5m litres, compared to 5.7m litres in 2002. Beer sales also climbed, to 6.5m litres from 5.2m litres year-on-year.

Sales of brandy, however, fell to 1.2m litres from 1.3m litres in 2002. VBF blames the drop on Norwegians heading to Denmark instead of Sweden to buy brandy. In October last year Denmark cut its brandy taxes by 45%.

Norwegians prefer to cross the borders into neighbouring Sweden and Denmark to buy their alcohol, thanks to the lower prices in the two countries. In 2001, Sweden reduced its wine taxes by 18.8%, while Norway increased its wine taxes early last year.

Wine sales to Norwegians have increased by 110% in the last two years at Systembolaget.