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U.S. won't withdraw from Universal Postal Union

Published September 26, 2019
Revised treaty should end cheap Chinese shipping to the U.S., which U.S. retailers and suppliers applaud.

GENEVA (BRAIN) — The U.S. elected to remain in the Universal Postal Union after an agreement was reached Wednesday, allowing it to better compete with China and other developing countries who ship products to the U.S. at lower rates.

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The revised Universal Postal Union treaty agreement allows the U.S. to set new postal fees in July 2020. Other countries receiving more than 75,000 metric tons of mail a year can begin implementing higher rates in January 2021, The New York Times reported. Chinese vendors have enjoyed a shipping advantage on small, high-valued items like electronics and clothing, U.S. manufacturers have said. 

"It is an important step toward a more fair sales environment for U.S.-based retailers and wholesalers," Pat Cunnane, president of Cunnane Bicycle Company, told BRAIN. 

President Donald Trump had ordered the State Department to start renegotiating the postal treaty a year ago and said the U.S. was prepared to withdraw from it next month if negotiations failed.

About 60 percent of packages shipped into the country are from Chinese companies, which often offer free shipping on small-item consumer orders. The shipping rates under the old treaty are based on weight, not value. It allowed shipments of packages up to 4.4 pounds for as little as $5.

According to The Times, the U.S. pushed for an agreement that could have led to a pricing free-for-all. A volume threshold is now set for countries that can self-declare rates, among several other controls on the process.

When Bishar Hussein, head of the Postal Union, said the new treaty passed, delegates from about 140 countries applauded. He cautioned on Tuesday that a withdrawal by the U.S. could have severely affect international mail service, The Times reported.

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