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Trump, China tariff, trade war: US postal treaty pull out attacks China



Donald Trump Xi Jinping
Wong/AP Photo

  • President Donald Trump announced that the US would withdraw
    from the Universal Postal Union, a 192-country treaty
    that helps to set international postage rates.
  • The decision appears to be a direct shot at China.
  • Chinese goods coming into the US are currently subject to
    lower postage rates, making it cheaper to ship items into
  • The Trump administration argued this gives an unfair
    advantage to China and incentivizes importing knock-off goods
    from the country.
  • The move is also the latest salvo in the US-China trade

President Donald Trump announced that the US would pull out of an
obscure 144-year-old postal treaty, in what looks to be his
latest direct shot at China.

The Trump administration announced Wednesday that the US would
leave the the Universal Postal Union treaty, an
agreement from 1874 that helps to standardize postal rules among
the international community.

The interesting aspect of the UPU decision is a more recent
addition to the agreement. The UPU, which is now under the United
Nations’ purview, sets rates that national postal services pay to
ship goods internationally. Under a deal reached in 1969,
developing countries can ship smaller items at lower rates than
developed nations like the US. The provision is designed to help
facilitate exports from smaller countries to give a boost to
growing economies.

But the provision also allows Chinese producers to ship
items to the US at significantly low rates even compared to some
US domestic shipping rates. The Trump administration says many
companies even offer free shipping to the US from China because
of these lower rates — and as a result, roughly 60% of inbound
shipping to the US comes from China.

The treaty was tweaked in 2016 to adjust for some of the
advantages to China after complaints from US administrations of
both political parties. But the Trump administration argued that
the changes were insufficient and the Chinese still received
special treatment. 

It also said the cheaper
rates incentivize the purchase of knock-off or counterfeit goods
from China. 

Peter Navarro, Trump’s uber-protectionist and anti-China
adviser, attacked the UPU as part of
a Financial Times op-ed
in September.

“Consider this: it costs more to ship a package through the
US Postal Service from Los Angeles to New York City than it costs
to ship that same package from Beijing to New York,” Navarro
wrote. “This inequity puts American small businesses and
manufacturers at a severe competitive disadvantage.”

The decision to remove the US from the treaty represents
another strike
at China in the ongoing trade war,
as the Trump
administration attempts to force the country to make major
economic changes and
reduce the US trade deficit
with the country.

highlights of that trade fight
have been the tariffs each
country has slapped on the other. Trump has imposed tariffs on
just over $250 billion worth of Chinese imports coming into the
US and has threatened tariffs on another $267 billion. China
responded with tariffs on $110 billion worth of US goods, and the
government is prepared to move forward with more

The decision also mirrors the growing nature of the
with the Chinese. The US has undertaken a series of
efforts that point to an escalation of its confrontation with
Beijing, including sanctions on members of China’s defense
ministry and allegations of election tampering.

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