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Postal services need to cut costs and increase revenue, says minister

Postal services need to cut costs and increase revenue, says minister

Minister Esther Dweck, of Management and Innovation in Public Services (MGI), stated that the Post Office needs to cut costs and increase revenues to reduce the losses it has been suffering since 2024. The state-owned company recorded losses of R$2.6 billion last year, four times more than the previous year.

The successive losses, among other reasons caused by the so-called “blouse tax”, which began to be levied on imports of up to US$50 and scared away consumers, led to the resignation of the state-owned company's president, Fabiano Silva , last Friday (4). The state-owned company also lost space to other logistics companies, which worsened the financial crisis.

"You have to cut costs on one side and seek revenue on the other. This is the solution for the Post Office, and in a sector that is undergoing transformation. [...] The Post Office no longer has a monopoly on the delivery sector, but continues to have the obligation to universalize the service, to be present in all municipalities in the country," said the minister in an interview with Estadão published this Wednesday (9).

According to her, this logic made sense 30 years ago, but that the math "no longer adds up." The minister responsible for state-owned companies' governance states that the Brazilian Postal Service (Cerios) was very strong in international deliveries, especially during the pandemic. However, this changed after the tax.

"The company was very strong in international deliveries, which boomed during the pandemic. It made significant gains until mid-2024. It had a 98% monopoly on international shipping. But it lost that when we fixed the international shipping tax," he stated.

She, however, avoided commenting on Silva's dismissal from the state-owned company, stating that it was his “personal decision.”

The Brazilian Postal Service has been posting losses since 2022, when it closed with a deficit of R$767 million. This amount decreased in 2023 to R$596 million, before skyrocketing in 2024. This year alone, the loss has already reached R$1.72 billion.

The state-owned company said in a statement that it remains committed to "restoring economic and financial balance" and has a goal of reducing expenses by R$1.5 billion this year. One of its revenue-generating initiatives, it said, is the Mais Correios marketplace platform, which went live earlier this month.

"Correios is rethinking its activities. They launched a marketplace and are expanding their functions to become a logistics company, in the healthcare and education sectors, for example. Mainly in healthcare, it could be delivering medicines and vaccines," the minister added.

Dweck also defended the federal government's proposal to remove state-owned companies that are dependent on the National Treasury from the federal budget, a measure that aims to free up space in the fiscal framework for investments by the state-owned companies themselves.

The current proposal requires the state-owned company to be able to cover at least 40% of its operating expenses with its own revenue and have a restructuring plan approved by different administrative bodies, including the company's board, the supervising ministry and the MGI itself.

“The company needs to cover at least 40% of its operating expenses with its current revenue and have a plan that demonstrates that it will succeed,” Dweck added.

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