U.S. backs Japan’s draft postal privatisation guideline

The United States on Friday threw support behind Japan’s draft guideline in privatizing the nation’s postal services, but repeated its request for a “level playing field” between a privatized postal insurance entity and private insurers, Japanese government officials said.

During one-day bilateral insurance talks, the U.S. delegation hailed Japan’s adoption of the draft guideline on Aug. 6, saying it marked a “forward-looking step” toward the privatization of Japan’s postal services, the officials said.

Japan spent considerable time explaining the latest developments and background to its plan to privatize Japan Post, including the compilation of the guideline, and the U.S. side appeared to gain a deeper understanding of the issue, the officials said.

The U.S. officials repeated calls on Japan to apply the same regulations to the life insurance service run by Japan Post as it does to its private-sector competitors, including foreign ones, when it is privatized.

It also requested that Japan Post not be allowed to offer any new or altered products until a “level playing field” is established, while urging Japan to ensure transparency in the process to privatize the postal services.

The U.S. delegation was led by Michael Beeman, chief at the Office of the U.S. Trade Representative’s department dealing with Japanese affairs. Shingo Yamagami, director of the Foreign Ministry’s Second North America Division, headed the Japanese side.

Officials from Japan’s Financial Services Agency and the Ministry of Public Management, Home Affairs, Posts and Telecommunications took part in talks. From the U.S. side, officials of the State Department and the Commerce Department also participated.

Under Prime Minister Junichiro Koizumi’s deregulation initiative, Japan seeks to privatize Japan Post’s three services of mail delivery, postal savings, and life insurance in stages from April 2007.

On Aug. 6, the Council on Economic and Fiscal Policy, a key-policy-setting panel chaired by Koizumi, unveiled a 10-point draft guideline to split Japan’s postal operations into four separate entities by 2017 at the latest.

It called for splitting Japan Post into the four businesses of mail delivery, postal savings, life insurance and management of over-the-counter services of post offices and putting them under a holding company.