China Post (and by extension Hong Kong Post) heavily subsidizes the 'export' rates for merchants as a government policy to encourage the industrial sector.
In addition, China is still a low wage country, although many Chinese industrialists are now exporting jobs to lower wage nations, many in Africa. So their labour and payroll costs* are genuinely much lower.
Then there is the Universal Postal Union, which is why you can get mail from China and send a birthday card to Nana in the old country.
All 178(?) signatories to the UPU have agreed to deliver each others mail and spend a great deal of administrative time working out how much each nation owes each other nation for this mutual service.
Most Western nations agree that China badly underpays the other signatories for their share and this is the subject of ongoing discussion, with changes being expected in 2018 at their convention.
https://en.wikipedia.org/wiki/Universal_Postal_Union
*If you are working you and your employer are contributing to the Canada Pension Plan and Unemployment Insurance as well as paying towards Medicare. If you are lucky you and your employer are also contributing to an extended health care plan and a private pension. Chinese workers? Nope.
