United States postal rates for the Marshall Islands are scheduled to rise in mid-2007, a move that local businessmen say will cripple the ability of companies there to access goods from the US and reduce their ability to overcome dominance of Asian-controlled businesses.
Since the U.S. took over administration of the Marshalls after World War II, the isands have been designated as a domestic U.S. zone, complete with American postal codes.
However that changed in early 2006, with the implementation of a new Compact of Free Association between the U.S. and Marshall Islands.governments that eliminated the domestic mail status in favor of a five year phase-in of international rates.
The second of those rate increases later this year will raise the base package rate by 220 percent and the letter rate by 65 percent.
As part of a proposed revamp of the international package service, the air mail parcel base rate is set to more than double from the pre-2006 domestic price of $3.20 for the first pound to S10.20 this year.
The change also affects the Federated States of Micronesia, which has a similar Compact of Free Association with Washington.
In addition to concern about the cost, the Marshall Islands Chamber of Commerce has also lodged complaints about the international designation change because it removed many previously offered mail services, including registered,
certified or insured mail.