Postmaster General Leonia Tai Shuk-yiu wrote in the latest annual report that the pandemic has continued to severely disrupt global connections and impact all sectors of the economy, bringing significant challenges to the government-owned postal service.

"With connectivity being the core of our business, significant challenges have been brought to Hongkong Post," she said.

The service had 5,951 staff, compared with 6,245 in the previous financial year.

The average cost of handling each mail item increased to HK$2.18 from HK$2.15.

"The situation was further exacerbated by the outbreak of the fifth wave in the first quarter of 2022 when some 30 percent of our staff were infected, resulting in intermittent disruptions," Tai wrote.

A huge reduction in air freight capacity had limited the capacity of the service while disruptions to maritime transportation increased costs significantly.

On e-commerce opportunities, Tai said "meeting this service demand, Hongkong Post continued to develop new business initiatives, such as Vantage services which are providing additional international mailing options for e-commerce business through our partnership with third party logistic operators," she said.

"We have also introduced an economical local service, EC-Get, that offers convenient and reliable delivery solutions."

Hongkong Post will extend the coverage of its self-service mail collection facilities iPostal Stations and self-service mail posting facilities iPostal Kiosks to all 18 districts to leverage the growth of e-commerce, Tai said.

The service is advancing in the redevelopment of its air mail center, which is expected to finish in 2027, to grasp the opportunities presented by cross-border e-commerce and contribute to the development of the Greater Bay Area.

Hongkong Post is taking forward the construction of its new headquarters near its central mail center at Kowloon Bay to replace its current headquarters in Central.