Tag: Japan

The government said Friday it has picked former Sumitomo Mitsui Banking Corp. President Yoshifumi Nishikawa as president of a holding firm to be established in October 2007 for the privatization of Japan’s postal system. The government expects Nishikawa, 67, who is known for his leading role in tackling the disposal of bad loans at banks, to show his expertise and leadership. But his selection may be a shock for workers at Japan Post, the public corporation in charge of postal services, as the banking industry Nishikawa once represented is a strong critic of the state-run postal system, calling for a reduction in postal savings services. At a news conference held to announce the appointment, Heizo Takenaka, minister of internal affairs and communications, said Nishikawa accepted the post in a meeting with Prime Minister Junichiro Koizumi on Friday.

Nishikawa, who also attended the press conference, expressed his resolve to push forward with the privatization, Koizumi’s pet policy.

Japan’s parliament approved the privatisation of the country’s postal service Friday, setting in motion the creation of the world’s largest private bank and delivering a crucial victory for Prime Minister Junichiro Koizumi’s reform program.

The package was passed 134 to 100 by the upper house. The vote paved the way for the enactment of the closely watched legislation, since the package was passed overwhelmingly by the powerful lower house on Tuesday.

The bills would split up and sell off Japan Post’s delivery, savings deposit and insurance services by 2017. The system controls some 330 trillion yen (USD2.9 trillion; euro2.42 billion) in savings and insurance deposits.

Koizumi has argued the change, which is the centerpiece of his reform platform, is needed to put the system’s massive deposits at the disposal of private investors. Those deposits had long been used by the ruling party as a fund for wasteful but politically useful public works projects.