Fernandez vows intent to reprivatize Argentina Postal Co
The government has no intention of keeping the country’s postal service in government hands beyond the 180-day period within which it has vowed to seek a new concessionaire for the operation, Cabinet Chief Alberto Fernandez said.
The concession was handled by Correo Argentino SA, a privately owned company.
In a radio interview, Fernandez denied that this week’s decree rescinding Correo’s contract was a sign of broader efforts in the Kirchner government to renationalize industries that had been privatized in the 1990s.
“We are not tempted with Correo. If anyone sees in this situation an ideological conception, thinking that a private concession was removed so that the state can exploit it, they are wrong. This is not our policy,” Fernandez said.
In rescinding the contract granted in 1997 this week, the government said Correo’s failure to repay a long-running debt to it amounted to a breach of contract and thus was justification for the heavy-handed action.
According to Fernandez, “the government had wanted that this problem never existed. But it’s all about someone who made a series of commitments and didn’t fulfill any of them.”
Under this week’s decree, signed by President Nestor Kirchner Wednesday, Correo will lose control of the concession, which will then fall into government hands for a period of 180 days while a new concessionaire is found.
Some analysts have expressed doubts, however, about the prospects of finding a willing buyer for an operation that has struggled to be profitable and which – at least according to the now rescinded contract – carried a sizable royalties payment to the government. FedEx Corp. (NYSE:FDX – News) was Friday quoted by La Nacion newspaper as saying it had no intention of bidding for the contract, arguing that the U.S. delivery company has never taken over national postal services in any of the countries in which it operates.
Meanwhile, Correo is weighing its legal options and has said it may still appeal the decree. According to an advertisement it ran in Argentine newspapers Thursday, the company has decided to ignore the decree and has vowed to continue operations until the legal status is resolved.
