1. EACO CONFERENCE ON ICTs transformation of the Postal &Courier sector in EA. THE CURRENT GLOBAL POSTAL AND COURIER ENVIROMENT /TRENDS INNOVATIVE INITIATIVES IN THE POSTAL AND COURIER SECTOR KENYA POSTAL CORPORATION EXPERIENCE 23-02-2015

2. CONTENT International/global postal/courier trends Regional landscape National trends Services Kenyans need Challenges Opportunities Socio/economic role of sector 03/06/20132

3. 1.0 International Landscape-World Postal & Courier performance 23-02-2015 3 There are 663,210 post offices around the world of which 2.1% are found in Africa. The global postal industry is seen as entering into a new era where complete revamping/diversification of products and services portfolios would become the order of the day. Several postal organizations have added digital alternatives, such as e- commerce and digital mail to their portfolios. Digital channels also provide additional opportunities for enhancing service quality. With technological substitution being experienced, the share of core traditional products in the overall revenue mix is declining. 2012-2013 Postal revenue Mix  Letter post-43.4% down from 51.1% a decade ago  Postal parcels and agencies- 18.6% up from 11.1% a decade ago  Postal Financial services-14.5% down from 15.9 a decade ago.  Other Products and services- 23.5% up from 21.9% a decade ago

4. International Landscape-contd’ 23-02-2015 4

5. 03/06/20135

6. 2.0 Regional Scene In 2015, East African economies are poised for higher macro- economic performance if its member states tackle unique experiences to thrive in 2015. From Kenya’s insecurity challenges to Tanzania’s and Burundi’s general elections, Uganda’s nascent oil industry and Rwanda’s aid flow recovery, the year heralds interesting times for the nations. According to the World Bank’s latest report Kenya’s economy is expected grow by 6 per cent, Tanzania’s by 7.2 per cent, Uganda’s by 6.6 per cent, Burundi’s 5.4 per cent and Rwanda’s by 6.5 per cent. Financial service, ICT and the construction sector are among the notable drivers of the growth. Regional postal administrations are increasingly adopting diversification strategies e.g. Post Bus services (Uganda and soon Kenya), dot Post, sharing regional financial services platforms, agency banking, with others like the Tanzanian, Rwanda and Burundi Posts operating Postbank services. 23-02-2015 6

7. 3.0 Trends in Kenya According to Kenya ICT survey 2010:  23 % of Kenyans have access to postal service. 15.4 have access to PLBs and Nairobi leads at 32.% and Eastern lowest - 4.9%  No of letters sent range from 0 at 87%,1-10 at 11%,11-20 at1% and more than 20 at 0.5%.  Letters sent are for social -74%,bills-28%,to financial institutions-18%,order goods/serv- 5% and to MDAs at 21.4%. 7 23-02-2015

8. 3.1 Services Kenyans need Internet-12%,telephone-16%,PLB-14%,D2D 35% MT 26% Demand for PLBs is at all regions with coast leading at 24%,Est at 21%,Nairobi,RV,Nyz,W and C Demand for D2D is also expressed in all regions with NBO leading. 8 23-02-2015

9. 4.0 Challenges facing Postal & Courier sector in the region Slow technology adoption in a fast paced tech world Lack of a comprehensive National Addressing system (inhibits door to door services) USO vs National commercialization of Post office ( network sustainability challenges) Electronic substitution Inadequate investment in the postal sector which is essential for expansion of the postal services (slow implementation of the National USF) 23-02-2015 9

10. 5.0 Opportunities for Postal & Courier sector Growing consumer preferences for E-commerce Growth in Financial services Kenyan New constitution (devolution opportunities) Diversification in other sectors e.g. passenger transport, Clearing & Forwarding and long-haul cargo delivery solutions PPPs framework Growing demand for door- to- door services Emerging ICT based innovations and value adds (PREM, EPCM, SMS alerts, virtual/digital boxes, dot post, Hybrid Mail solutions) 23-02-2015 10

11. 6.0 The Social and Economic Value of Postal & Courier Services The postal sector is seen as an essential component of the global economy. Its strength lie in its 3 dimensions of physical, electronic and financial through which posts offer quality communication services and products. In Kenya, the postal sector has an important role to play in the attainment development goals through the following: Facilitation of domestic and international trade and communication through physical and electronic service delivery Promotion of an information society by bridging the digital divide. Promotion of National Financial inclusion agenda Promotion of social services through government social funds transfer schemes and engagement in universal service in underserved areas contributing to poverty alleviation Enhancing private sector development through an efficient communications and distribution system. 23-02-2015 11

12. THANK YOU 12