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Denmark and Finland plan to upgrade the status of their respective Palestinian representative offices in Copenhagen and Helsinki to that of an embassy, the Danish foreign ministry said Saturday.
"It is with satisfaction that we announce our joint intention to work with the Palestinians to be able to upgrade the status of the Palestinian missions in Copenhagen and Helsinki," the foreign ministers of Finland and Denmark, Villy Soevndal and Erkki Tuomioja, said in a joint statement.
The changes are expected to be implemented sometime in 2013, it said.
The move would "not entail a formal bilateral recognition of a sovereign Palestinian state by Denmark and Finland," the statement said.
"Palestine is in a phase of state-building, and many challenges remain for president (Mahmud) Abbas to handle before we can recognise Palestine formally as a state," it said.
"But it is important to keep focused on the aim of Palestine becoming a fully recognised state and as such claim its rightful place as part of the international community of states."
In November, Denmark and Finland backed a resolution recognising the Palestinians as a non-member observer state at the UN.
The two ministers said they hoped their intentions would "encourage president Abbas to engage with determination in the necessary negotiations with the Israeli government on a two-state solution."
Palestinian foreign minister Riyad al-Malki hailed the announcement.
"We are certain, with the decision by Google to use the name 'Palestine' instead of 'Palestinian Territories' and after being recognised as an observer state at the UN, that we are continuing in the right direction," he told AFP.
Neighbouring Sweden's parliament voted in March to upgrade the Palestinian mission in Stockholm to that of an embassy.
A slew of European countries have already done the same.