09/20/2019 | Press release | Distributed by Public on 09/21/2019 07:05
By SBE Council at 20 September, 2019, 12:45 pm
America's Small Businesses Seriously Harmed by Outdated and Unfair Model
For Immediate Release
Washington, D.C. - Today, Small Business & Entrepreneurship Council (SBE Council) president & CEO Karen Kerrigan expressed appreciation for the Trump Administration's unwavering efforts to resolve long-standing disparities within the Universal Postal Union's (UPU's) terminal dues system.
'The flawed and highly unfair international rate system is massively unfair to America's small businesses. U.S. postal customers are subsidizing foreign competitors shipping costs, and oftentimes these packages include counterfeits. Fixing this outdated system is one key way to level the playing field for U.S. small businesses and their foreign competitors, like the Chinese.' said Kerrigan.
Current terminal dues rates set by UPU and provided by the United States Postal Service (USPS) to foreign shippers give these shippers favorable rates for packages sent into the U.S., which happen to be far lower than what U.S. small businesses are charged to ship packages domestically.
In advance of the UPU's upcoming extraordinary congress on September 24th, Dr. Peter Navarro, Assistant to the President and Director of the Office of Trade and Manufacturing Policy, outlined the United States' plan of action in an op-ed, 'Change the unfair international postal rate system now,' published by Financial Times.In the piece, Dr. Peter Navarro summarized the unfair treatment that has continually undermined U.S. manufacturing in the U.S. - a problem that has also touched many America's small businesses:
'Today manufacturers in countries as small as Cambodia and as large as China pay less to send small parcels from their countries to New York than U.S. manufacturers do to ship packages from Los Angeles to the Big Apple. This puts American manufacturers and workers at a significant competitive disadvantage and forces the US Postal Service to subsidise a system that weakens America's manufacturing base.'
In conclusion, Dr. Navarro highlighted the only acceptable U.S. outcome:
'At the end of the day, the US simply seeks a system of self-declared rates within the UPU. That arrangement would provide for fair and undistorted competition for companies based in all 192 of its members.
The U.S. team is heading to the extraordinary congress to achieve that goal. In the end, however, we will not allow our desire to remain in the UPU to overcome President Trump's overarching goal of fairness for America through self-declared rates. Let the extraordinary congress begin.'
Earlier this summer, SBE Council president & CEO Karen Kerrigan sent a letterto Dr. Navarro encouraging the Administration's efforts to end the unfair subsidies provided by the U.S. Postal Service (USPS) to foreign competitors that give them a significant competitive advantage over U.S. businesses. Kerrigan wrote:
'Among the proposals that can be considered for a vote by member nations, we trust that you are in agreement that there must be only one course of action that would rectify the competitive harms presented by the current system. Provisions that will allow countries to charge self-declared rates on in-bound packets, with rates not higher than the domestic rate is the optimal path forward to promote fairness and undistorted competition.'
Last October, President Trump initiated steps for withdrawal from the UPU and for the U.S. to self-declare rates. In response, SBE Council issued a press release with additional information, comments, and helpful links.
Karen Kerrigan, SBE Council president & CEO
e-mail: [email protected]
SBE Council is nonpartisan advocacy, research and education organization dedicated to protecting small business and promoting entrepreneurship. For 25 years, SBE Council has worked on and advanced a range of private sector and public policy initiatives to strengthen the ecosystem for strong startup activity and small business growth. Visit www.sbecouncil.org for additional information. Twitter: @SBECouncil