Japanses parcels firm sees entry in postal services market 'dificult'

Japan’s top parcel delivery firm expressed doubt Wednesday as to whether the government was ready to open postal services to private firms as reports said the postal ministry would require a new player to install some 100,000 postboxes of their own.

Yamato Transport Co. Ltd., seen as the only serious rival to the public entity if postal services are opened up to free competition, now sees it as “difficult” to enter the sector, company spokeswoman Miki Shiratori said.

The comment came after the Japanese media reported that among other conditions the Ministry of Public Management, Home Affairs, Posts and Telecommunications would require newcomers to install at least 99,000 postboxes nationwide.

The number is equivalent to about 60 percent of the postboxes currently installed.

“We have been considering expanding (into mail delivery services) as we support the ministry’s policy of allowing private companies to enter the market under a deregulation drive,” Shiratori said.

“But the reported content of draft legislation on confidential correspondence… has made us wonder whether the ministry has started moving in a somewhat different direction,” she said.

“If the bill passes as it is, it may be difficult for us to enter,” the market, she said, adding postboxes should not be the sole way of collecting mail as Yamato could pick them up from customers’ homes and offices directly.

The draft legislation was presented to a meeting of the ruling Liberal Democratic Party’s general affairs division in charge of postal matters, the Tokyo Shimbun said.

The Sankei Shimbun reported the requirement to install proprietary postboxes “will certainly set high hurdles for the private-sector entry.”

The bill is due to be introduced alongside other legislation to create a public entity to take over the nation’s postal services in 2003 to ensure more efficient and flexible operations.

Details of the public entity are to be set under the new legislation.

“What will happen after the establishment of the public entity is still unclear,” an official at the Postal Service Agency said.

“It is undecided whether the services will be totally privatised… although that is an option,” she said.

Privatising the three postal services — mail, savings and life insurance — has long been one of reformist Prime Minister Junichiro Koizumi’s pet schemes.

Many in his own Liberal Democratic Party are opposed to the privatisation as postal workers form a strong support base for the party.

AFP English