German Deutsche Post to face increasing competition

Deutsche Post, the German postal service, is expected to face increasing competition in services involving the collection and sorting of letters. Until now, the company has refused to allow competitors to collect and sort letters weighing less than 100g; discounts are granted only to major customers. However, the EU believes that this is an infringement of guidelines on the liberalisation of postal services. Wolfgang Clement, the German minister of economic affairs, has now agreed to amend the law on postal services in Germany in order to open up the market for the collection and sorting of letters.

It is not known how much of a drop in turnover and profit Deutsche Post can expect as a result of the amendment of the law; however, analysts have estimated that the company is likely to lose no more than EUR200m to EUR300m in turnover. The market for these services is thought to have potential for strong growth, and the liberalisation of the market is expected to lead to the creation of new jobs. The law is to be amended immediately.