Japan's Postal Sector Opens in 2003

The Posts Ministry has decided to allow the private sector to fully enter postal operations as early as fiscal 2003, the Nihon Keizai Shimbun learned Wednesday. The decision would eliminate for the first time ever the government monopoly on the collection and delivery of envelope mail and postcards, and enable package shipping firms to handle all types of mail. The ministry intends to include the proposal in the draft of the postal corporation law set to be submitted to the ordinary Diet session convening in January. Previously, the ministry had proposed allowing the private sector to begin collection and delivery in 2003 of large mail packages weighing 300-400 grams or more. Then, other areas would have been opened up to private companies in gradual stages. However, the ministry decided to speed up the deregulation process following the urging of Prime Minister Junichiro Koizumi to allow full private-sector entry as soon as possible once the postal corporation is set up in fiscal 2003. If package shipping firms begin postal services, consumers will be able to mail letters and postcards at locations other than post offices, such as convenience stores and gasoline stations. This could eventually lead to shorter delivery times and lower fees if the number of competitors increases. If a large number of private companies start operations in large metropolitan areas, which are a major earnings source for the postal corporation, its finances may worsen. This could affect mail services in less populated areas. For this reason, the ministry may require private-sector firms that want to enter the regular mail market to provide their services nationwide at the same rate. Posts Minister Toranosuke Katayama plans to relay the ministry’s proposal to Koizumi soon.” (Source: Nihon Keizai Shimbun/Dow Jones)