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President Trump on Wednesday decided to withdraw from a 144-year-old international postal agreement, which allows Chinese companies to send small parcels to the United States with a substantial discount. Government officials announced that government authorities would increase competition and cost the post office about $ 170 million a year.
Trump's announcement to step out of the Universal Postal Union treaty comes as the White House exacerbates pressure on Beijing to abandon what it calls predatory business practices, including corporate disclosure of trade secrets. Americans operating in China.
"This problem has been around for a long time," said Robert Taub, chairman of the Post Regulatory Commission, an independent federal agency.
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The administration described the departing departure as distinct from the trade war that saw Trump impose duties on about half of Chinese goods entering the United States.
The abandonment of the postal treaty, ratified for the first time in 1874, is expected to exacerbate tensions with China, but the US postal service and business groups applauded the action on Wednesday.
"The current system has led the United States to subsidize imports of small parcels from other countries," said Jeff Adams, spokesman for the US Postal Service.
Under the treaty, which sets the fees charged by domestic carriers in 192 countries for the delivery of mail, the US Postal Service charges companies based in China at a greatly reduced rate for parcels weighing less than 4.4 pounds.
Trump administration officials said the boost, granted under a 1969 provision, was aimed at promoting growth in poor countries. But it remained in place after China became an e-commerce powerhouse.
The agreement allowed the country to flood the United States with cheap goods with discounts of up to 70% on shipping costs, which puts American companies at a competitive disadvantage and puts the US mail system under severe strain. while fueling growth abroad, said Taub.
This resulted in losses of $ 170 million for the post office last year.
"They use our postal service and do not contribute to overhead, and Americans have to pay for it," he said.
A package of one pound that costs about $ 10 to the US Postal Service can be shipped from China for only $ 2.50, according to White House figures.
Officials said they informed the UPU, based in Switzerland, that the United States intended to withdraw from the pact – a one-year process, in line with the United Nations rules.
During this period, the State Department will aim to negotiate better rates for Americans, said the White House, or to move away from the international body by 2020.
The UPU Director General, Bishar Hussein, said in a statement Wednesday that he "regrets the decision" and welcomed the opportunity given to him for his visit. interact with US officials.
"The UPU remains committed to achieving the lofty goals of international collaboration by working with its 192 member countries to ensure that the treaty benefits everyone," he said.
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The postal treaty has angered the leaders of both parties long before Trump took office, said Taub. The Reagan administration lobbied for change with few results, and a 2015 government report warned that mail from abroad was putting a strain on the US postal system.
Singapore and European countries also benefit from this arrangement.
The number of parcels from China has increased over the past decade as the country has evolved into an e-commerce hub with the largest online retail market in the world, with annual sales of around 354 billions of dollars.
China's small parcels in the United States jumped 182% between 2011 and 2012, according to the latest figures from the US postal service.
Sean Heather, vice president of the US Chamber of Commerce's Global Regulatory Cooperation Center, welcomed the administration's decision to negotiate higher rates for China and other countries.
"US companies should not pay more for parcel delivery in the United States than the US postal service collects to deliver parcels overseas," he said in a statement.
But some analysts missed Wednesday's move.
Derek Scissors, who studies China at the American Enterprise Institute, a right-wing think tank, said Trump's announcement did not carry much weight compared to what he promised to do in September.
After Beijing imposed new taxes on US imports worth $ 60 billion, Trump announced he would reduce taxes on Chinese products by $ 267 billion, raising border taxes on everything. that the United States is buying from China.
So far, this plan has not materialized.
"It's a headache that diverts from the fact that the president has promised to raise tariffs last month and he does not want to act," said Scissors.
A firmer approach to getting better rates for the United States would include other developed countries, such as Norway, which also bear a disproportionate burden as a result of the UPU pact, said Blaine Johnson, China analyst of the Center for American Progress, a leftist tank thinking.
"Threats of withdrawal may actually be counterproductive," she said, "because US allies might prefer a more consensus-based approach."
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