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The State Postal Bureau (SPB) has increased the cost of mailing letters and postcards.

Local letters weighing less than 100 grams will cost 0.8 yuan (10 US cents) for every 20 grams, up from 0.6 yuan (8 cents), the bureau announced on its website. Long-distance letters less than 100 grams will cost 1.2 yuan (15 US cents) per 20 grams, up from 0.8 yuan (10 US cents).

Sending postcards will also now cost more, rising from 0.6 yuan (8 US cents) to 0.8 yuan (10 US cents) each.

The bureau has not mentioned any change in the international mailing fees or for other postal services such as parcels and Express Mail Service (EMS).

The rise was expected to ease difficulties facing the postal service and help boost its business development, an official from the National Development and Reform Commission was quoted as saying.

The news left people on the streets relatively unmoved.

"The rise is only a few cents. Compared with other price hikes, this is really tiny," said Ye Zi, 30, a university lecturer in Beijing.

"People have got used to sending emails nowadays. Few people take the trouble to go to the post office and send a letter," said Wu Jun, 37, who works in an IT company in Beijing, adding he had not sent a letter in years.

China's postal system has suffered huge losses since 1998, with losses in 2005 registering at 398 million yuan (US$50.6 million).

The State Council has approved the plan to establish the centralization of postal services to a state-owned group with a registered capital of US$10 billion. The SPB will remain an administrative body.

The new group will provide all services such as domestic and international mail, EMS, postal savings, postal remittance, distribution of newspapers and magazines, and postal logistics.

According to a government statement, the central government will stop subsidizing the group for postal businesses like EMS. The move is expected to create a fairer environment for competition in the postal sector.

(China Daily November 16, 2006)