Rep. Meadows Applauds President Trump's Decision to Withdraw from Universal Postal Union

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Washington, October 17, 2018 | Ben Williamson (202-225-6401) | comments

Rep. Meadows Applauds President Trump's Decision to Withdraw from Universal Postal Union

Washington, D.C. – Today, the Trump Administration announced their intention to withdraw the United States from participation in the Universal Postal Union (UPU), an intergovernmental organization that sets standards for international mail. The withdrawal is a critical victory for American businesses who have faced a non-competitive postal market due to postal subsidies paid on behalf of foreign merchants.

One of the standards arranged by the UPU is a pricing control for foreign shipped goods being carried within the United States. The UPU provides subsidies to compensate domestic posts, such as the U.S. Postal Service, for the domestic portion of a shipment between a foreign country and its U.S. destination. For example, if a Chinese company ships a good from China to California to North Carolina, the UPU compensates postal providers for the domestic portion costs of this trip—or from California to North Carolina, in this case. These are fixed prices called “terminal dues.”  

The terminal dues payments have the effect of a subsidy paid to Chinese companies for foreign shipped goods, essentially creating an artificially low rate for foreign products and putting American based shipments at a disadvantage. Under the current system, shipping a good from Shanghai, China, to Hendersonville, North Carolina, can be cheaper than shipping a good across neighboring state lines in the U.S. These subsidies put U.S. companies at disadvantage in the postal service market. In some cases, the disproportionate shipping charges even allow Chinese merchants to set the TOTAL price of their product (including shipping) for less than an American businesses would pay for shipping by itself—sending the exact same product domestically.

The U.S. will continue existing protocol for sending and receiving international mail for the next year, given no nation can withdraw from the UPU until after one year’s time. However, this announcement will begin a one year clock, putting the U.S. on track to be withdrawn by the end of 2019. The prospect of withdrawing from the UPU has been an ongoing battle Rep. Meadows has advocated for over four years. 

Rep. Meadows released the following statement on the policy change:

“Once again, President Trump and his administration have gone above and beyond to put the interests of American workers first. I’ve advocated for ending these postal subsidies for years, mainly because of their negative impact on American small businesses, as they put our workers at a massive disadvantage on the postal market. The current subsidy program essentially makes mail shipped from overseas to Western North Carolina cheaper than mail from North Carolina to neighboring Virginia.

Each and every time under the previous administration, I was told withdrawing from the UPU would be impossible. That sentiment immediately changed when this President took office. Now, American small businesses can enjoy a competitive postal market without fear of being railroaded by subsidies enriching foreign companies.

I thank President Trump, Peter Navarro, and those in the administration for making this reform possible and doing what so many said could not be done. This is just the latest example of the Trump administration’s steadfast commitment to putting America first.”

Read the White House statement on the policy change here.


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