What's Happening?
The Trump administration has suspended the 'de minimis' trade exemption rule, which allowed small packages worth less than $800 to enter the United States duty-free. This decision, effective from August 29, 2025, has led to a significant drop in postal traffic to the U.S., with an 81% decrease reported by the Universal Postal Union (UPU). The UPU is actively seeking solutions to restore postal traffic, as at least 88 postal operators have suspended services to the U.S. The administration argues that the suspension will help combat criminal activities such as the import of counterfeit goods and fentanyl.
Why It's Important?
The suspension of the trade exemption rule is expected to impact international trade and postal services significantly. By imposing tariffs on all imports, the U.S. aims to reduce the trade deficit and curb illegal shipments. However, this move may disrupt global postal networks and affect businesses relying on international shipping. The decision could lead to increased costs for consumers and businesses, potentially affecting the U.S. economy and international relations.
What's Next?
The UPU is working on developing technical solutions to resume postal traffic to the U.S. Meanwhile, the Trump administration may face pressure from international postal operators and businesses affected by the suspension. The administration's focus on securing borders and restoring trade fairness may lead to further policy changes impacting international trade.
