New agreement will eliminate postal subsidization of imports
Washington. The Coalition for a Prosperous America (CPA) today praised the efforts of Peter Navarro, White House Director of the Office of Trade and Manufacturing Policy, for taking a tough negotiating position at last week’s Universal Postal Union (UPU) talks. The United States had threatened to withdraw from the UPU because it currently requires the US Postal Service (USPS) to deliver incoming parcels at unfairly low rates. At the talks, China and other developing countries agreed to pay more to send parcels to the United States.
“President Trump and Peter Navarro have eliminated a major competitiveness problem for American producers,” said James Stuber, Co-Chair of CPA’s Buy America Committee. “The UPU treaty required the US Postal Service subsidize shipping costs of international parcels. As a result, it was cheaper to ship a package from Shanghai to Kansas City than from Atlanta to Kansas City.”
Professor Navarro threatened that the United States would leave the UPU unless member countries agreed to allow the US to set its own postal rates—instead of the low rates specified in the treaty. After some debate, UPU members agreed to Navarro’s proposal. The new fees accepted by the UPU—which will be phased in over five years—allow the post office to charge higher rates for the delivery of international packages.
“The current, low shipping fees imposed by the UPU have made it possible for China to flood the US with e-commerce deliveries at below market shipping rates,” said Greg Owens, Co-Chair of CPA’s Buy America Committee and CEO of Liberty Tabletop. “That has effectively subsidized China’s manufacturers while hurting domestic US companies. The post office has suffered revenue losses as well. The revised fee system is overdue and should help to create new opportunities for companies like mine that manufacture American-made products.”
Read the statement on UPU reform from the White House Office of Trade and Manufacturing Policy.