China Post said this week that it expected group revenues to rise by 5.5% to 67.05 billion yuan(EUR 6.65 billion) this year, as postal reforms in the country take hold.
The postal group, which was officially separated from the state postal bureau (now the marketregulator) on Monday, is responsible for all domestic and international mail delivery, express andlogistics services, China Postal Airlines and the national post savings bank. China Post made aloss of 398 million yuan (EUR 39.4 million) on revenues of 57.7 billion yuan (EUR 5.7 billion) in2005.
Making the revenue forecast at a ceremony marking the new entities, China Post admitted itwas concerned about the “weak competitiveness” of its mail and express businesses. The rise ofprivate and foreign express companies were placing increasing pressure on the state-owned postalsystem, China Daily newspaper reported.
Yuan Goli, China Post delivery director, said the new corporation had to improve management,lower operating costs and undertake product innovation to raise its competitiveness.
“It is true (though) that we have the obvious advantage of a network in over 2,000 citieswhich may take a long time and great effort for private or global firms (to repeat),” Yuan toldChina Daily.
Zhang Xiaoqiang, vice-minister for the national development and reform commission, said, atthe ceremony, that China’s postal system was entering a new phase, with the government responsiblefor market supervision, but the China Post Group independent in its management.
“There is much work to do to deepen the reform in the company as well as the administrativebody,” Zhang said.
China Post, which has registered capital of 80 billion yuan (EUR 7.92 billion), has lostmarket share massively in recent years to international competitors and is investing in its EMSexpress business with a new network, additional services and more international flights toneighbouring countries.
While the universal postal service would remain subsidised in future, China Post’s expressand logistics services, which are to be merged, would not receive any state subsidies, the officialXinhua news agency reported.
Under a restructuring plan, China Post Group could be opened up to external financing,including strategic investors or a stock flotation, according to the Chinese media.
