Running a small business that ships low-weight merchandise, say 10 T-shirts or small hardware from China to the United States, made logistics costs easy. The U.S. provided for a large shipping discount of 40 percent to 70 percent.
Such generosity came from U.S. membership in the Universal Postal Union (UPU). Founded in 1874, the UPU is the international postal organization in Switzerland, committed to a smoothly running the international postal system.
In 1969, the UPU’s developed country members implemented discounts for poor nations when shipping small parcels. China then was isolated with few outward shipments.
As a result, the shipping cost of a face cream was more affordable from China for American consumers than it was from Los Angeles. Today, however, China delivers more than 1 billion small packages a year to the U.S., but the special discount treatment continued.
Then there came change. The Trump administration announced U.S. withdrawal from the UPU as of Oct. 17, 2018. The objective was to arrive at competitive and fair global shipping rates.
This move showed the Trump administration’s willingness to quit multilateral agreements judged unfavorable to U.S. interests. Although the UPU withdrawal process takes one year, U.S. deep discounts for Chinese packages ended immediately.
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