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Finance Minister Sadakazu Tanigaki said Friday the government must clarify how it will privatize the nation’s postal services without generating concerns about creating a possible glut in the Japanese government bond market and extra operational costs.

“It may be hard for the public to understand a plan to privatize the nation’s postal services unless the government clarifies the process, especially with the view to ensuring the smooth absorption of massive issuances of JGBs,” Tanigaki said.

Japan Post, which handles the nation’s three postal services — mail delivery, postal savings and “kampo” life insurance — is one of the major buyers of JGBs.

Market players expect the bond market to become turbulent if the government fails to present a clear picture of the privatization process and postprivatization organization.

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