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U.S. signals intention to pull out of international postal treaty

Staff Writer |
The U.S. on Wednesday announced its intention to withdraw from the Universal Postal Union, a treaty that President Donald Trump has said is unfair to the U.S. Postal Service and U.S. manufacturers and consumers.

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The announcement begins a one-year process during which U.S. officials will seek to renegotiate the treaty, which Trump says costs the U.S. Postal Service hundreds of millions of dollars annually.

Under the agreement, foreign merchants in countries such as China are able to ship small parcels weighing 2 kilograms or less into the U.S. under a discount rate structure set by the UPU.

It costs as much as 70% less for a merchant in China to ship an item to a U.S. destination than it does for a U.S. merchant to send to that same address, senior administration officials said on a conference call.

"This system causes rates to be higher for American exporters and lower for shippers [into the country], which hurts our manufacturing base," an official said.

The system causes the U.S. Postal Service to lose USD300 million a year, they claimed.

In the renegotiations, the U.S. will seek the ability to self-declare rates for packages that are 2 kilograms or less to recoup the actual cost of delivery, the officials said. The goal is not to leave the UPU, they added.

The officials said that while packages from China are a particular problem, the situation was similar with parcels from other countries, including Singapore, France and Germany.

Other countries share the same concerns, including Australia, New Zealand, Iceland, Denmark, Ireland and Sweden, the officials said.

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