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Customarily the seller pays customs which is a percent of the price IIRC, the free trade zones allow China and other countries to ship stuff in bulk to another country and stage it as well as offset the cost of customs until the time of purchase. So it allows them to pre-ship bulk items to domestic staging areas. This may account for how the item gets to your country, but yes is does not account for domestic shipping. China may have agreements in place for domestic rates in other countries but that I do not know. I do know the Special Economic Zones account for the ability to get items from China to consumers at extremely low cost per item.



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