Eyes on China, US threatens to pull out of postal treaty

The Trump administration announced on Wednesday that it was intending to leave the Universal Postal Union, now an agency administered by the United Nations which sets international postal rates.

Throughout the Universal Postal Union’s 144-year-old history, the international system in its various forms has largely avoided the spotlight. But thanks to the success developing countries, including China, have had in becoming e-commerce giants all that has changed.

Critics in the US argue that the lower rates charged to developing countries are no longer justifiable, and they give an unfair advantage to overseas manufacturers.

In an announcement, a senior administration official told reporters that the US is still open to negotiating a better deal.

“This is a strong action by this administration to fix this flawed system and make it better,” the official told reporters, per The Hill.

“Our goal here is to get fair rates, not necessarily to get out of the Universal Postal Union,” the official added.

According to analysis from Bloomberg Government, a US withdrawal from the UPU may be advantageous for shipping companies such as FedEx and UPS, who will be better positioned to compete with the US Postal Service.

It may also help Amazon in its competition with foreign e-commerce companies. Additionally, it may benefit US manufacturers, one of the stated motivations for the administration’s move.