Important bit of information: China gets subsidised parcel fee under an agreement of the World Post Association. They pay less for postage than European businesses shipping within the continent.
So here it goes: there’s an international treaty saying basically “if a letter from your country is delivered in my contry, I’ll deliver it for free and vice versa”. So, you pay your national post some “international handling” so they e.g. deliver it to China, but in China the national post is now responsible for distribution and last mile for free, they don’t see a part of your postage.
So it’s subsidized now by the Chinese post basically: they only charge cents for “international shipping” to their citizens and businesses, last mile is handled for free from the local national post offices.
That system obviously was designed to work frictionless and easy in a time, where there was no globalized market to speak of.
It’s not so easy to reform and just cancel it might be a disadvantage as well: then all your other mailing stuff needs renegotiating as well. Just imagine the horror in canceling the treaty, and then you need to sit down with dealmaker Trump who sees an opportunity in order to get the US Post to handle your mail 😱
It’s managed by the Universal Postal Union, which is part of the UN, and the organisation has been in effect in one form or another since 1874 with 192 members currently. International treaties between so many countries are extremely difficult to reform. It’s much easier to make a new treaty than reform an existing one because there are so many vested interests in the current system.
In this case, the subsidy is designed to help developing countries have fair access to the global post system. But when it was created, it was likely not envisioned that a developing country might become a rich country, nor that the postal system would become such an important part of e-commerce.
I’m guessing it just goes on flights that would be going anyway, probably filling in gaps where larger packages don’t fit which would just be empty anyway.
No clue what agreements they have with the carriers to let them do that for dirt cheap, but it’s the only thing that makes sense.
Important bit of information: China gets subsidised parcel fee under an agreement of the World Post Association. They pay less for postage than European businesses shipping within the continent.
Why is this not changed? Why all these additional taxes and hoops when they could simply cancels these subsidies?
They’re implicit subsidies.
So here it goes: there’s an international treaty saying basically “if a letter from your country is delivered in my contry, I’ll deliver it for free and vice versa”. So, you pay your national post some “international handling” so they e.g. deliver it to China, but in China the national post is now responsible for distribution and last mile for free, they don’t see a part of your postage.
So it’s subsidized now by the Chinese post basically: they only charge cents for “international shipping” to their citizens and businesses, last mile is handled for free from the local national post offices.
That system obviously was designed to work frictionless and easy in a time, where there was no globalized market to speak of.
It’s not so easy to reform and just cancel it might be a disadvantage as well: then all your other mailing stuff needs renegotiating as well. Just imagine the horror in canceling the treaty, and then you need to sit down with dealmaker Trump who sees an opportunity in order to get the US Post to handle your mail 😱
It’s managed by the Universal Postal Union, which is part of the UN, and the organisation has been in effect in one form or another since 1874 with 192 members currently. International treaties between so many countries are extremely difficult to reform. It’s much easier to make a new treaty than reform an existing one because there are so many vested interests in the current system.
In this case, the subsidy is designed to help developing countries have fair access to the global post system. But when it was created, it was likely not envisioned that a developing country might become a rich country, nor that the postal system would become such an important part of e-commerce.
Good question. I guess you have to ask those responsible.
easier to add a new agreement than cancel an old i guess. treaties are hard
I’ve wondered for years how they manage free shipping for all the small shit.
I’m guessing it just goes on flights that would be going anyway, probably filling in gaps where larger packages don’t fit which would just be empty anyway.
No clue what agreements they have with the carriers to let them do that for dirt cheap, but it’s the only thing that makes sense.