US President Donald Trump plans to withdraw the US from a 192-nation treaty that gives Chinese companies discounted shipping rates for small packages sent to US consumers, another escalation of his economic confrontation of Beijing.
US officials said the administration sought to revise the treaty last month and was rebuffed by other nations, prompting the decision to withdraw.
The US Department of State was on Wednesday to deliver a notice to the Universal Postal Union (UPU) in Switzerland, White House press secretary Sarah Huckabee Sanders said in a statement.
Photo: Reuters
RENEGOTIATIONS?
Under the union’s framework it takes a year for a country to withdraw, during which rates can be renegotiated.
The officials, who briefed reporters on condition of anonymity, said postal rates would not change for at least six months, and that the US would prefer to stay inside the union’s system.
The president wants to adopt “self-declared rates” as soon as practical, and no later than Jan. 1, 2020, Sanders said.
“If negotiations are successful, the administration is prepared to rescind the notice of withdrawal and remain in the UPU,” she said.
US manufacturers applauded the move.
“President Trump deserves tremendous credit for the administration’s focus on eliminating the anti-US manufacturer subsidy China receives from the US Postal Service,” National Association of Manufacturers president Jay Timmons said in a statement. “This outdated arrangement contributes significantly to the flood of counterfeit goods and dangerous drugs that enter the country from China.”
The group said the discounts amount to a subsidy for Chinese shippers that cost the US Postal Service US$170 million last year.
The treaty sets fees that national postal services charge to deliver mail and small packages from other countries.
Poor and developing countries are assessed lower rates than wealthier countries, an arrangement that has benefited China.
‘RIGHT STEP’
United Parcel Service Inc (UPS) said the administration “took the right step” in withdrawing from the accord.
“Foreign postal operators should not be given government approved advantages in what is a competitive market,” UPS said in a statement. “All parties should pay the same parcel delivery rates for the same services from the US Postal Service, regardless of whether the country of origin is foreign or domestic.”
FedEx Corp declined to comment.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
RSS