Absolut Vodka: a drink of State

The usual problem of public companies (referring to government-owned corporations) is the lack of competitiveness, which, in addition to several aspects of the public economy, has been the reason why this kind of companies have been privatized within the last two decades.

Governments tend to blame this inefficiency on the product they offer, traditionally related to energy, infrastructures or communications. The privatization of some public corporations proved, however, that even this kind of products could be profitable (take, for instance, the last results of Telefonica).

But energy, natural resources or infrastructures are just the most common "public products"; some countries, far from being affraid of the power of capitalism have extraordinarily introduced their products in global markets, reaching important market shares. Can you imagine which is the Swedish government star product? Right: Absolut Vodka.

Absolute, as the second vodka brand by sales volumes, shows that public companies can actually have benefits. It is difficult to imagine the Dutch government owning Heineken, or the American owning Jack Daniels, I would like to think that it is difficult due to a matter of Ethics of those governments, though I think it is due to a lack of imagination, in fact. Do you think it is ethically correct for a government to produce vodka? It may be a paradoxe, but Sweden had the hardest anti-alcohol policies of the E.U., and the amount of alcohol per person per year is five times less than the one in Spain (20 l. to 5 l.). Does it mean the Swedish know how to deal with alcohol?

Anyway, Absolut Vodka will probably not be a Swedish public company from next autumn, as several private companies such as Bacardi are interested in buying it. A politically-correct decision that will decrease the public income, time to focus just on forests or education.