As well as the post office, USPS is state-owned.

Caixa de correio do USPS é vista na Quinta Avenida, em 24 de fevereiro de 2021
USPS mailbox as seen on Fifth Avenue on February 24, 2021 in New York City
Photo: view via John Smith/Getty Images

One of President Jair Bolsonaro’s campaign promises was the privatization of public companies, such as post office. Now, more than two years later, and with Eletrobras capitalizing ahead in Congress, the government is once again paying more attention to public distribution service sales.

The plan is to sell 100% of the state-owned company’s capital, according to Diogo Mac Cord, the special secretary for privatization, disinvestment and markets at the Ministry of Economy, in an interview with the newspaper O Globo this Monday. )

However, the plan faces resistance from officials, unions, politicians and even the Attorney General of the Republic (PGR), Augusto Arras, who all consider the sale of postal services to be unconstitutional, as it is an essential service. And therefore, it must be a guarantee of its universalization by the state.

The problem, according to the economic team, is that the Correios business is not financially sustainable. After a period of consecutive losses from 2015 to 2017, it returned to profit two years ago, but that does not mean it is in a comfortable position, as it had to receive contributions from the national treasury and the contract was too red. loan during the years.

post office man work
Photo: Ricardo Moraes/Reuters

The landscape is not unique to Brazil

Despite the wave of privatization in postal services during the 1990s, particularly in European countries, this delicate discussion is not unique to Brazil.

For example, the US maintains the United States Postal Service (USPS), established in 1775. A wholly state-owned entity, responsible for delivering mail and goods throughout the country.

In total, there are more than 34 thousand branches in the US region, with approximately 496,000 employees, which is four times that of Brazil. As with the Post Office, the USPS is funded by revenue from its mail delivery service, a business that hasn’t been profitable there or here for years.

The distribution structure generated revenue of over US$73 billion (approximately R$379 billion) last year, but still, the US company reported a loss of US$9.2 billion in the period.

plate with phrase "we love USPS" Det is seen from the window of a residence.
The “We love the USPS” sign is seen in the window of a house in Detroit, Michigan, USA.
Photo: Elaine Cromi For The Washington Post Via Getty Images

Because of these disadvantages, there is also frequent discussion about business restructuring or possible privatization in the US. Recently, USPS sales to the private sector came into focus again during the tenure of former President Donald Trump, but did not proceed.

One of the main reasons for the failure of this idea is that it hurts the sentiments of Americans, who see themselves as somehow represented in the delivery service. Last year, a survey by Morning Consultancy revealed that USPS is the most loved brand in America, listing fifty others such as Google, UPS, Amazon, Netflix, FedEx, Oreo and Kellogg’s.

For ranking, consultancy created brand love index, formed by metrics such as trust and influence on the community.

In the US, delivery service is also not exclusive to the public sector and there are many other companies that provide the service. National FedEx and United Parcel Service (UPS) are the most famous.

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Will Smith

About the author: Will Smith

Will covers public and private tech markets from New York. He was previously a Knight-Bagehot Fellow in Economics and Business Journalism at Columbia University, and prior to that was a reporter at the Los Angeles Business Journal. He has received a Journalist of the Year award from the L.A. Press Club and an investigative reporting award from the Society of American Business Editors and Writers.

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