Wither SAPO? The Continuing Saga of the SA Post Office

The SA Post Office was placed under provisional liquidation on February 9 after a court application by a creditor owed for rent. The Post Office’s most recent available financial statements are for the financial year 2021/2022, in these it is clear that SAPO owed more than R4.4bn to creditors and its debt exceeded its assets by R4bn. Since February it has received R2.4bn from Treasury and has put up a number of properties for sale (EFSA’s postbox was in one property which is now locked up ready for auction!).  Government still needs to decide what to do with this failed SEO. There is still hope for SAPO to avoid liquidation if it can secure a bailout or find a buyer to take over its operations before 1 June 2023, when the case returns to court. One alternative put forward by Mike Barnes (a past CEO of SAPO) is to privatise the entity, however, this is not popular with policy makers who are keen to turn around SEOs, rather than sell them off. Meanwhile, the uncertainty has affected e-merchants who use SAPO for delivery (cheap, slow and unreliable but with a wide distribution into rural areas and townships not well served by other delivery services).

One ray of hope for SAPO is the ongoing court case which we reported on previously between ICASA (the regulator)/SAPO v. PostNet on SAPO’s claim to hold a monopoly over last mile deliveries. A success in that court case plus a change in the Postal Act could allow SAPO to pivot its operations. Another solution would be to sell off Post Bank which is extensively used to distribute social security payments, particularly in the rural areas.

The Universal Postal Union (UPU) appointed SAPO as the ecommerce hub for Southern Africa some years ago. This bring profitable revenue through ‘terminal dues’ – see above. There is no word from SAPO on what is happening to this hub under the present circumstances, EFSA is concerned that ecommerce deliveries to other Southern African states will suffer.