The planned privatization of the postal system, which doubles as the world's biggest savings bank, was hailed around the globe as a watershed free-market reform that would streamline the world's No. 2 economy.
But just months before the October kickoff date, a darker prospect looms over what will unseat Citigroup Inc. as the world's biggest financial institution. Far from encouraging open competition, some are warning that the government-nurtured colossus could leverage its size to stamp out rivals, foreign and domestic.
Washington is pressuring Tokyo to ensure that won't happen, and Japan is promising strict safeguards. Yet uncertainties about how the 10-year privatization plan will unfold are fueling fears of a new Japan-U.S. trade row.