Singapore deregulates mail delivery

Postal reform has stalled in many countries, but last week Singapore proved a happy exception. The city-state committed to open its market for "basic mail" service to foreign and domestic competition, says the Wall Street Journal.

The announcement mandates Singapore's media and communications regulator to end Singapore Post's (SingPost) monopoly on delivery of letters and postcards on April 1.

The move completes a cycle of privatisation that started in the 1970s, when the city-state liberalised mailing of printed papers and parcels.

Despite the liberalisation, not all barriers were broken down; the announcement did come with a few caveats, says the Journal:

SingPost will keep a firm grasp on the so-called "master keys" that provide access to apartment-building mailboxes.

Any new delivery service will be obliged to either spend the money to go door-to-door or pay SingPost a carry fee to deposit letters in mailboxes.

Anyone who wants to set up a full-blown competing mail service must acquire a licence that will require the company to set up a collection and distribution infrastructure to rival SingPost's a prohibitive cost that's expected to deter many new entrants from undertaking island-wide mail service.

Nevertheless, the move will benefit many businesses, most of which are concentrated around the city-state's downtown strip. The liberalisation of basic mail marks a major step toward competition, which could see SingPost losing as much as 15 per cent of its current market share by 2010.

Source: Editorial, SingPost Smarts, Wall Street Journal, February 14, 2007.

For text: http://online.wsj.com/article/SB117141114941207791.html?mod=opinion_main_europe_asia

For more on Privatization Issues: http://www.ncpa.org/sub/dpd/index.php?Article_Category=37

FMF Policy Bulletin/ 20 February 2007

Publish date: 01 March 2007
Views: 394

Regulation, Post-office, News

The views expressed in the article are the author’s and are not necessarily shared by the members of the Foundation. This article may be republished without prior consent but with acknowledgement to the author.

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