Published: Fri, October 19, 2018
Worldwide | By Myra Stephens

Trump administration names 6 prospective currency cheaters

Trump administration names 6 prospective currency cheaters

The U.S.is willing to renegotiate the treaty over the next year but will leave the union if no agreement can be reached, the officials said.

A 2015 report from the Inspector General of the U.S. Postal Service found that the treaty, which was created to ease the flow of mail and small parcels between 192 countries, had not been overhauled to reflect the new realities of e-commerce and China's aggressive undercutting of worldwide competitors.

"The U.S. postal services winds up picking up the tab for that", said the official.

Trump's notice to exit from the Universal Postal Union (UPU) treaty comes as the White House cranks up the pressure on Beijing to drop what it calls predatory commercial practices, including swiping trade secrets from American companies operating in China.

A one-pound package that costs the U.S. Postal Service about $10 to deliver can be mailed from China for just $2.50, according to White House figures. However, there are a lot of moving parts to global mail delivery, and the United States could find itself playing a game of "Jenga" in which it tries to, in effect, pull out a single block without crashing the entire stack.

No country has been labeled a currency manipulator by the United States since the Clinton administration tagged China in 1994.

"This outdated arrangement contributes significantly to the flood of counterfeit goods and unsafe drugs that enter the country from China", said Jay Timmons, chief executive of the National Association of Manufacturers, a trade group.

The action by the White House has been attributed by many sources as a response to UPU rates favoring other countries, with China singled out most frequently.

The heavily discounted shipping rates were meant to stimulate flagging economies, but the Trump administration says China's status hasn't been updated since it became an e-commerce powerhouse over the past decade, clocking about $354 billion in annual sales. "All parties should pay the same parcel delivery rates for the same services from the U.S. Postal Service, regardless of whether the country of origin is foreign or domestic".

China's Ambassador to the U.S. Cui Tiankai told "Fox News Sunday" host Chris Wallace that there is no trade war between the two countries, but then seemed to contradict himself by claiming America started it.

Chinese manufacturers soon will no longer enjoy shipping discounts on products they send to the U.S.as President Donald Trump takes another step in his campaign to redress America's trade imbalance with the Asian giant.

But some analysts brushed off Wednesday's move. "Manufacturers and manufacturing workers in the United States will greatly benefit from a modernized and far more fair arrangement with China".

So far, that plan hasn't materialized.

The United States will also file notice formally withdrawing from the union, which dates to 1874, the statement added.

It is not clear how much the disparity costs USA taxpayers and retailers, in part because the Postal Service does not release detailed country-by-country shipping breakdowns.

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