I haven't found a resolution to this issue on this forum, so I'll post one.

The tailgate/lift gate was latched and would not open. There may be several reasons for this but in my case although the servos made all the right sounds the tailgate remained latched. Turns out, a plastic housing stop on the cable for the latch actuator had broken and the cable had become unhooked from the latch mechanism. Unlike later models, there is no slot in the latch that can be used to release it.

Solution:

• The latch can be accessed from the top of the trim panel. Pull back the trim panel on both sides of the wiper mechanism. It will pull away from the tailgate enough to permit access. It's tight, but it can be done
• Credit to YouTuber ThePeku84 for the solution. I am unable to embed his videos but they are titled "Volvo V70 P3 (mk3) tailgate lock" and "Volvo V70 P3 Tailgate lock open". My contribution is to provide measurements for the special tool he used in case anyone cares to make one. I bent the following tool using 1/8" welding rod:
  
  Latch opening tool (1/8" welding rod). Dimensions are 10mm, 90mm, and 80mm. Bends are 70 degrees, 90 degrees, and 20 degrees (not critical - close is fine)
• The tool works with latches with Volvo p/n 31253450. Slot the 10mm end of the tool into a slot on the right back side of the latch (looking rearward from inside the car). The slot is shown in the following image, but is not visible from inside the car

• Move the tool along the slot in the direction of the arrow. At about 45mm you will engage a lever in the locking mechanism. It doesn't require much pressure. The latch will open, be patient.
• If, as in my case, you find that the latch actuator cable housing stop was broken, it can be glued. I used crazy glue (cyanoacrylate), ymmv.