Barring an eleventh-hour agreement, the U.S. Postal Service (USPS) will leave the Universal Postal Union (UPU) on October 17, ending 144 years of U.S. involvement in the international body that governs the exchange of mail and postal parcels between countries, and perhaps fundamentally changing the landscape of global air shipping.
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The practical effect of the exit of the U.S. would be a rate increase of at least 300 percent on postal parcel traffic to the U.S. from heavy net exporting countries as rates kept artificially low for decades begin to normalize, according to Matthew White, a strategist for iDrive Logistics, a consultancy working with customers to prepare contingency plans for the possible U.S. exit. U.S.-based international shippers will also pay more, at least over the short-term, because USPS will cancel negotiated service agreements (NSA) covering international shipments if the withdrawal takes place, White said.
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Chinese companies ship many low-cost, low-value shipments to the U.S. via the postal infrastructure. Beijing may retaliate if it views the U.S. action as another step in ratcheting up the broad trade dispute, White said.
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