2003 Reports

Policy challenges and the reform of postal savings in Japan

Scher, Mark J.

This paper discusses the current policy challenges to the existence of Japan's postal saving system, the main repository for Japan's household savings. Some critics have erroneously conflated the investment function of mobilized funds that occurred under the government's managed by the Ministry of Finance, with the collection mechanism managed separately by the Ministry of Posts. Critically reviewed are the efficacy and wisdom of the search for market-oriented investment policies in view of the public's real fears for the safety of their savings; current proposals to privatize, not only the postal savings system but also the post delivery system itself and the potential loss of essential services to rural populations.