Trump pulling out of pact that discounted
foreign postal deliveries
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[October 18, 2018]
By Jeff Mason and Chris Sanders
WASHINGTON (Reuters) - The Trump
administration will begin withdrawing from a United Nations pact that
offered low rates for foreign postal deliveries of small packages in the
United States, the latest move to challenge practices it sees as
unfairly advantageous to China.
White House officials said on Wednesday the United States would start
the process of leaving the Universal Postal Union (UPU), a
Switzerland-based organization that connects postal services worldwide.
The White House said the UPU enables foreign postal services to take
advantage of cheap shipments to the United States, creating an unfair
cost advantage over U.S. companies that ship goods, and hurting the U.S.
Shares of internet-based mailing and shipping provider Stamps.com fell
nearly 9 percent after the announcement. Online shoppers in the United
States have often benefited from the arrangement, gaining access to
foreign goods at little cost.
U.S. President Donald Trump is distancing the United States from
international multilateral organizations and accompanying policies that
he says hurt U.S. interests. Trump has announced U.S. withdrawal from
the Paris agreement to mitigate climate change and an international deal
with Iran to curb Tehran's nuclear program.
The White House will seek to renegotiate the terms of the UPU rules
during the year-long withdrawal process, officials said.
"If negotiations are successful, the administration is prepared to
rescind the notice of withdrawal and remain in the UPU," White House
spokeswoman Sarah Sanders said in a statement.
China's foreign ministry spokesman Lu Kang said that China regretted the
U.S. decision to pull out of the UPU, adding that the pact has had a
positive effect on trade and communications.
China's consistent position was to safeguard multilateralism and it
would continue to participate in and support the work of the union, he
told a regular news briefing.
UPU Director General Bishar Hussein said he would seek meetings with
U.S. officials to discuss the matter.
"The UPU remains committed to attainment of the noble aims of
international collaboration by working with all its 192 member countries
to ensure that the treaty best serves everyone," he said in a statement.
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A mailbox for United States Postal Service (USPS) and other mail
outside a home in California. REUTERS/Lucy Nicholson/File Photo
One senior White House said the treaty's "subsidy" had facilitated
the transfer of a high level of counterfeit goods and the narcotic
and fentanyl trade.
Another official said the system allowed for a 40 to 70 percent
discount on small packages arriving in the United States from China
compared to what it would cost to send them domestically, costing
The official described it as an economic distortion that the
administration wanted to correct.
A change could benefit U.S. merchants and shippers, including
Amazon.com Inc, which have called on U.S. officials for years to
address foreign postal services' access to low rates. Amazon
declined to comment.
The National Association of Manufacturers called the agreement
"outdated" and said it "contributes significantly to the flood of
counterfeit goods and dangerous drugs that enter the country from
(Additional reporting by Chuck Mikolajczak and Jeffrey Dastin and by
Philip Wen in Beijing; Editing by Susan Thomas and Grant McCool)
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