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Development Strategies for the Postal Sector: an Economic Perspective Development strategies for the postal sector: an economic perspective DEVELOPMENT STRATEGIES FOR THE POSTAL SECTOR: AN ECONOMIC PERSPECTIVE Development strategies for the postal sector: an economic perspective Published by the Universal Postal Union Development strategies for the postal sector: an economic perspective Published by the Universal Postal Union This book’s findings, interpretations and conclusions are entirely those of the authors and do not necessarily represent the views of the Universal Postal Union. ISBN : 978-92-95025-50-9 Eburon Academic Publishers P.O. Box 2867 NL-2601 CW Delft The Netherlands [email protected] / www.eburon.nl Designed by Remy Pedretti and Elliot Breckenridge Joseph, Universal Postal Union, graphic art unit. Except as otherwise indicated, the copyright in this publication is owned by the Universal Postal Union. Reproduction is authorized for non-commercial purpose, subject to proper aknowledgement of the source. This authori- zation does not extend to any material iden- tified in this publication as being the copyright of a third party. Authorisation to reproduce such third party materials must be obtained from the copyright holders concerned. Graphics credits: Elliot Breckenridge Joseph. Universal Postal Union P.O. Box 312 3000 BERNE 15 SWITZERLAND www.upu.int © 2014 – Universal Postal Union Preface p. 11 Acknowledgements p. 13 INTRODUCTION Development strategies for the postal sector: an economic perspective p. 15 PART 1: SNAPSHOT AND TRENDS Chapter 1 Postal economics and statistics for strategy analysis – the long view p. 19 José Ansón and Matthias Helble Chapter 2 Postal economics and statistics for strategy analysis – the short view p. 41 José Ansón and Matthias Helble PART 2: MODELS Chapter 3 Status of the postal service 20 years after the Green Paper: a Franco-European perspective p. 57 Joëlle Toledano Bialot Chapter 4 The economics of postal delivery in developing countries: learning from the Latin American and Sub-Saharan experiences p. 85 José Ansón, Rudy Cuadra, Altamir Linhares, Guillermo Ronderos and Joëlle Toledano Bialot Chapter 5 Postal regulation in Sub-Saharan Africa p. 107 Marie-Odile Pilley PART 3: OPPORTUNITIES Chapter 6 Financial inclusion, postal banking and the future postal economic model p. 147 José Ansón and Joëlle Toledano Bialot Chapter 7 Big postal data, nowcasting and the global pulse of the economy p. 179 José Ansón and Matthias Helble Chapter 8 Global postal connectedness p. 193 José Ansón and Matthias Helble CONCLUSION Ten key takeaways p. 219 NOTES AND REFERENCES Endnotes p. 227 Bibliography p. 231 PREFACE Bishar A. Hussein, Director General of the UPU International Bureau I am delighted to present this second book on postal economics, produced by the International Bureau in response to requests from our member countries. The research delves into issues seldom studied by postal economists. It looks at the specific features of postal markets in developing countries and traces the emergence of new legislative and regulatory frameworks in Sub-Saharan Africa. The book examines the impact of the European Green Paper, which has driven postal reform policies in the European Union. The authors also present the role and strategies of post offices in the delivery of basic financial services to all citizens, since financial inclusion as a means of fighting poverty is now again a priority in the developing world. The analysis of long- and short-term trends based on UPU data and sta- tistics offers fresh insights into the challenges facing the postal sector in this age of connectivity. The real-time modelling of international exchanges by our researchers is a major leap forward for the UPU and will enable our experts to develop scenarios, and to measure, test and evaluate our postal network. The UPU will be able to identify and remove hurdles in the postal supply chain and reduce information asymmetries. Moreover, two major lessons can be drawn for the Sub-Saharan region. First, for postal reform to succeed, the development agenda must include an evidence-based postal policy. Second, there is no “one size fits all” regulatory solution. Regulatory approaches in industrialized countries cannot be automatically applied to developing countries. I thank our external contributor Professor Toledano Bialot for her invaluable contribution in reviewing the research work. Professor Toledano Bialot is a leading theoretician and practitioner who successfully chaired the UPU’s postal economics groups over the last two cycles. 10 | 11 Development strategies for the postal sector: an economic perspective This project benefited from the generous funding by France’s La Poste Group, which has always been committed to postal economics research. I express my most sincere thanks to La Poste and to France, on behalf of the entire UPU, and invite other member countries to imitate this support in the future. Finally, I thank the members of the International Bureau’s Economic and Regulatory Affairs Directorate for their remarkable efforts in putting this book together and bringing UPU big data to the forefront within the UN. I look forward to having this directorate become a centre of information and excellence on postal statistics and economic analysis. AKNOWLEDGEMENTS This book is the product of a collective effort to shed light on the eco- nomics of postal markets worldwide – an effort that goes far beyond the authors’ own contributions. Numerous experts from the UPU International Bureau and other institutions have furnished insightful comments and suggestions. The authors also wish to thank the UPU’s member countries for providing the information and data that feed their research and studies. The release of the book in English and French was made possible through the support of the International Bureau’s translation services. The authors thank them wholeheartedly. The design of a book’s layout is always a time-consuming and challenging task. Here, special thanks go to the International Bureau publishing team. Finally, the authors also thank Edward Elgar Publishing for authorizing the reprint of the article “Status of the postal service twenty years after the Green Paper: a Franco-European perspective”, by Joëlle Toledano. The original version of this research can be found in chapter 15 of the book Reforming the Postal Sector in the Face of Electronic Competition, edited by Michael A. Crew and Paul R. Kleindorfer, and published in the “Advances in Regulatory Economics” series (2013). 12 | 13 INTRODUCTION Development strategies for the postal sector: an economic perspective This book examines the economics of the postal sector through three lenses: snapshot and trends, models, and opportunities. In the years to come, the Universal Postal Union plans to develop its role as a knowledge centre for the postal sector from these perspectives. At this time of radical transformation of the postal sector, it is important to understand how the sector has evolved historically, how it is connected with the economic system, and where it is heading. This book thus first presents a long-run view, focusing on incumbent operators over the last three decades, and then describes their development in the last five to ten years. It also offers a real-time picture based on daily “big postal data”, revealing one of the greatest opportunities for the sector in terms of forecasting and product design. The book seeks to present the variety of situations in the world and their evolution, and to explain why some sector policies cannot easily be transposed from one place to another – or the “what not, when not, why not, where not”. It introduces the European postal economic model, and then turns to developing and emerging countries to discuss the circum- stances underlying the lack of development of their postal markets. Of paramount importance is an understanding of the structural differences between industrialized and developing countries if the sector is to survive, let alone develop, in this fast-changing world abounding with threats but also opportunities. No less critical is the need to provide decision and policy makers with economic intelligence tools and applications built on a modern data ana- lytics framework so that they can seize tomorrow’s opportunities. The last part of the book presents the opportunities offered by both financial inclusion policies and the facilitation of international postal exchanges in the era of e-commerce. 14 | 15 Development strategies for the postal sector: an economic perspective Our view is truly global because, as highlighted in the first UPU book on postal economics for developing countries (Ansón and Toledano ed., 2008), the scope of postal economic research has often been confined to industrialized countries. A focus on developing countries is now required. In the new connectivity era, with more than seven billion inhabitants in the world, it would be a strategic mistake not to build and develop “click and mortar” postal networks that potentially allow every citizen and enterprise to be connected to an integrated worldwide logistics and com- munication network. The “club effect” is a well-known property in network economics: the greater the participation in a network, the higher the utility of this network for each of its participants individually, and the higher the overall value of the network itself. In fact, the most successful historical developments of the postal sector have been rooted in the inclusion of all in the postal system, ever since Sir Rowland Hill’s stamp revolution in Great Britain in the 19th century, followed by Gladstone’s use of the post office retail network for the collection of small savings. These developments helped turn the utopian vision of uni- versal access to postal services into a reality in industrialized countries. The first part of this book (chapters 1 and 2) looks back at the postal supply of universal service – or incumbent – operators in postal markets from both a long and short perspective on the basis of UPU postal sta- tistics.
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