Vietnam firstly elected to Universal Postal Union

Minh Vu

Sep 01, 2021 / 08:16 PM

Vietnam's postal sector will become essential to the country's digital economy by 2030.

Vietnam has been elected to the Postal Operations Council (POC) of the Universal Postal Union (UPU) in the 2022-25 tenure for the first time since the country joined the body in 1976.

Ambassador Le Thi Tuyet Mai at the UPU Congress held in Ivory Coast. Photo: MoFA

Competing to the position is fierce competition as only 48 countries are elected to the council, according to Ambassador Le Thi Tuyet Mai, Permanent Representative of Vietnam to the UN, the World Trade Organization, and other international organizations in Geneva, who attended the 27th UPU Congress held in Ivory Coast on August 9-27.

Deputy Foreign Minister Dang Hoang Giang said that the move is of significance as the postal sector plays an important part in each country’s economy and in a global scale, helping smooth the circulation of goods and services, especially in the context of the Covid-19 pandemic.

Giang said the move shows Vietnam’s role in the world’s arena and demonstrates its multilateral diplomacy.

“This is a great success of the Vietnam Post and the Ministry of Information and Communications in international integration work,” Giang said.

Established in 1874, the UPU is the second oldest international organization worldwide with the participation of all UN members.

With its 192 member countries, the UPU is the primary forum for cooperation between postal sector players. It helps to ensure a truly universal network of up-to-date products and services.

It fulfills an advisory, mediating, and liaison role, and provides technical assistance where needed. It sets the rules for international mail exchanges and makes recommendations to stimulate growth in mail, parcel, and financial services volumes and improve the quality of service for customers.

The Postal Operations Council (POC) is the technical and operational mind of the UPU, dealing with the operational, economic, and commercial aspects of the postal business. POC makes recommendations to member countries on standards for technological, operational, or other processes within its competence where uniform practices are necessary.

Vietnam's post sector gets growing. Photo: Minh Trang/ VGP

Vietnam’s postal sector

According to the World Bank’s report named “The role of postal networks in expanding access to financial services”, Vietnam’s postal services date back to when the French ruled Indochina and set up a mail system. The Vietnam postal services renovated its operations and expanded its network to ensure that people had access to basic communications facilities.

Considering that 80% of the Vietnamese people live in rural areas, the dense postal network truly can link the nation.

The Vietnam postal service provides a high level of service with reportedly 99.83% of the population receiving mail at home, six days a week. In urban areas, Vietnam Post provides mail delivery twice daily. This is a huge benefit for the business sector.

Various independent publications and websites focused on the international business sector recommend the use of Vietnam Post; in particular, its express mail service is praised.

The postal network is State-owned and offers both postal and telecommunications operations. It has rapidly expanded during the past years, including new outlets, such as kiosks.

In the strategy for the postal sector by 2025 and vision to 2030 planned by the Ministry of Information and Communications, Vietnam’s postal sector targets to have a revenue of US$9-12 billion by 2025.

Under the plan, the postal sector becomes essential to the country and digital economy, mostly e-commerce by 2030.

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Postal service shows potential

14 May, 11:36

The domestic postal service has great potential to develop, but first urgent solutions must be found to overcome the existing market difficulties, experts said.General director of Vietnam Postal Corporation (VNPost) Do Ngoc Binh said the domestic postal service market has an average growth rate of 10-25 per cent per year, which has attracted the attention of many enterprises that trade postal and express mail services mainly in large cities such as Hanoi and HCM City.Vietnam is now integrating into the world economy, and the postal market would have new chances to develop, he said.According to the commitments that accompanied World Trade Organisation membership, Vietnam must open the domestic postal service market this year.The move would permit foreign-invested enterprises to enter the local market and spark competition, meaning that local providers would have to improve the quality of their services, Binh said.Vietnam has 44 enterprises that are licensed to trade express mail services, although many others have provided the same services without licences.Nguyen Thai Khang, Information Technology editor at the Vietnam Post newspaper, said many foreign firms were expected to acquire shares at equitised State-owned postal enterprises.However, local express mail service providers were not prepared to co-operate with other local firms in order to develop, due to a lack of investment and low-quality delivery networks, Khang said.Luong Ngoc Hai, general director of Viettel Postal Joint Stock Company (Viettel Post), said the existing economic crisis has affected the local postal service market.Postal firms have not dared to increase their service fees to compete with rivals although the cost of petrol and transport has increased sharply on the market. Instead, they have had to restrict operation costs to reduce losses.In the future, Hai said local post firms would have to compete with four global express mail service providers: FedEx, UPS, TNT and DHL. These firms would expand their market shares in Vietnam after the local market opened under the WTO commitments.Hai said it is necessary to build an association of postal and express mail service providers ahead of time, in order to help local firms improve the quality of their services and compete against their larger rivals.Nguyen Thanh Hung, deputy minister of Information and Communications, said the ministry would support the establishment of the association. Local firms should carefully consider the advantages and disadvantages of the proposal to succeed in future business endeavours.Hai also said the State should build a strategy for the development of human resources within the larger scheme to improve Vietnam's postal services.