Yellow Card of the Week – Mozambique Post Office

This week's yellow card goes to the Mozambique Post Office, an institution that, for decades, was a symbol of state presence, connecting communities, and supporting the country's socioeconomic development, but which today is remembered only as an example of bankruptcy foretold, with its real estate assets being sold off at successive auctions. The case is particularly worrying because it demonstrates not only the collapse of a strategic public company but also the absence of a clear and sustainable vision for the role of state infrastructure in a context where technological transformations are putting pressure on traditional service models. The decision to sell the properties, years after insolvency, reveals a short-term strategy that prioritizes immediate liquidity over restructuring, modernization, and job preservation, opening the way for deeper reflection on the direction of public policy in Mozambique.

Postal services, everywhere in the world, were conceived as much more than simply delivering letters. They constitute a widespread physical network, present even in the most remote areas, serving as the only connection for many communities with the state and the formal economy. Throughout history, postal networks have enabled the circulation of information, goods, official documents, school supplies, and even vaccines, at times when other public services were scarce or nonexistent. This inclusive dimension did not disappear with the arrival of the digital age. On the contrary, in many countries, postal services have been modernized and reconverted into strategic platforms to support basic financial services, support the digitalization of the state, and integrate e-commerce. The Universal Postal Union recognizes this role, highlighting the postal network as one of the most important instruments for governments to advance financial inclusion, e-governance, and logistical integration. This is why, in many contexts, postal services continue to be understood as an irreplaceable asset and not simply as a loss-making enterprise to be liquidated.

There's no shortage of successful examples. Italy, through Poste Italiane, managed to transform a declining network into a diversified giant, which today not only continues to guarantee universal postal service but also leads the financial and insurance sectors, with PostePay established as a benchmark in digital payments. In France, La Poste adapted to the digital age, becoming one of the government's main partners in the implementation of digital identity and electronic public services, using its network of branches and postmen as in-person validation points. Japan, through Japan Post, also embarked on a path of reinvention with its "JP Vision 2025" plan, focusing on integrating financial services, insurance, and logistics under one brand, in a strategy to restore trust and efficiency. Closer to home, Namibia transformed its postal services into instruments of financial inclusion through NamPost, which, with its financial arm PostFin, brings microcredit, savings, and payments to communities underserved by the traditional banking system. Singapore has gone even further by repositioning Singapore Post as a regional e-commerce and last-mile logistics operator, operating as a strategic partner for small and medium-sized businesses in Southeast Asia.

What unites all these cases is the fact that none of these countries opted to simply liquidate the network and sell assets as a final solution. On the contrary, they realized that the postal service's greatest asset lies in its territorial reach and the trust built over decades as a public institution. With strategic vision, they pivoted the business model, diversified revenue, created public-private partnerships, and established clear performance targets, while simultaneously maintaining jobs and expanding services. This comparative experience clearly demonstrates that selling assets and closing services is not inevitable, but the result of political choices.

In Mozambique, the easiest option was to close operations, declare insolvency, and sell properties, many of them located in strategic, central areas of cities. This decision has profound implications. First, because it means the loss of a national infrastructure that could serve as a foundation for the expansion of digital, financial, and logistical public services. Second, because it devalues ​​the inclusive role of the postal network, ignoring the fact that thousands of citizens, especially in rural areas, continue to need physical points of contact with the State, whether to receive a pension, obtain a certificate, or access basic services. Third, because it reveals a pattern of governance in which structural solutions are replaced by short-term, patrimonial responses, without considering the long-term impacts on development and social cohesion.

The massive sale of assets by the Mozambique Postal Service cannot be seen simply as a corporate liquidation. It is, above all, a reflection of how the country deals with its technological and institutional challenges. It is true that the advancement of mobile technologies, such as M-Pesa, mKesh, and e-Mola, has rendered many of the postal service's traditional functions obsolete, especially with regard to payments and remittances. It is also true that traditional letter mail has declined dramatically due to the migration to digital platforms. However, these transformations, which have put pressure on postal services worldwide, have been seen by other countries as an opportunity to reinvent the service, not as a pretext for its extinction. In Mozambique, by failing to explore avenues for diversification and modernization, the opportunity to transform the postal service into a public policy tool for the digital age is being missed, something that would be extremely useful in a country with significant social inequality, low banking penetration, and a lack of infrastructure.

Alternatives existed. The deficient physical network could have been reduced through franchise models, transforming small outposts into agencies operated by local merchants while preserving the postal code and postal route. Counters could have been converted into multi-service centers, supporting e-government programs, social payments, and document issuance. The real estate portfolio could have been managed through a selective sale and lease mechanism, ensuring the preservation of strategic assets and selling only surplus assets. Through partnerships with development banks and telecommunications operators, it would have been feasible to relaunch basic financial services, productive microcredit, and digital inclusion, leveraging the trust that the Correios brand still enjoys among many communities. Instead of an abrupt closure, a restructuring with clear, publicly audited performance targets would have allowed not only to maintain jobs but also to transform the postal service into a competitive player, connected to e-commerce and the digital economy.

By opting for liquidation, the government and responsible managers send the message that they prefer quick and seemingly easy solutions, even if this compromises the country's future ability to structure sustainable public policies. The risk is that a dangerous precedent is set: whenever a public company faces structural difficulties, the solution will be to sell assets and cut jobs, rather than reform, innovate, and restructure. This logic not only weakens the State's institutional sovereignty but also limits the future of the national economy, which is left without strategic infrastructure that could be leveraged in times of transformation.

When observing the case of the Mozambique Post Office, one cannot help but notice a sense of collective loss. A network of proximity that could serve as a foundation for inclusion policies is lost. An opportunity to integrate the country into the digital economy in a more balanced manner is lost. Above all, the confidence that public institutions can be reformed to meet the demands of the 21st century is lost. A yellow card is, by definition, a warning before the maximum penalty. And in this case, the warning goes to the public management logic that sacrifices the long term for the short term, structure for the immediate, reinvention for liquidation. It is still possible to change course, but this would require political courage, strategic vision, and a commitment to social inclusion—three dimensions that currently appear to be missing from the equation.