The United States has questioned why China discriminates between domestic and imported sources of recycled materials.
In a meeting at the World Trade Organisation (WTO) reviewing China’s trade policy, the United States asked: “The Secretariat Report notes that imports of “all solid waste products” have been prohibited as of 1 January 2021, but “[c]ertain recycling materials” may be still imported. Can China explain the scientific basis that it used to determine which categories of ‘recycling materials’ are acceptable for importation and which categories are not acceptable for importation? What is China’s policy regarding expansion of the list of ‘recycling materials’ that is acceptable for importation?” Can China explain why it discriminates between domestically sourced solid wastes and certain recycling materials, which are not prohibited, and imports of solid wastes and certain recycling materials, which are prohibited?”
To which China responded: “According to the Law of the People’s Republic of China on the Prevention and Control of Environmental Pollution by Solid Waste, raw materials derived from solid wastes which have been processed and treated comply with compulsory national product quality standards and pose no danger to public health and ecological safety, are not classified as solid wastes, and can be imported into China through normal product trade. Moreover, there is neither a list of ‘recycling materials’ that are acceptable nor policy regarding expansion of the list. In accordance with the principles universally recognised by the international community, the proper disposal of domestically generated solid wastes is the responsibility and obligation of every country.”
The United States’ representative then asked a follow-up question as why China “discriminates between domestically sourced solid wastes and certain recycling materials, which are not prohibited, and imports of solid wastes and certain recycling materials, which are prohibited?”.
China’s representative responded: “Unlike ordinary raw material products, solid wastes have inherent pollution properties. Scrap materials and wastes are defined in diverse ways across countries, without unified understanding and standards among the international community.
“In particular, the definition of solid wastes in China follows the provisions of the Law of the People’s Republic of China on the Prevention and Control of Environmental Pollution by Solid Waste, which is basically consistent with the legal meaning of wastes under the Basel Convention. Namely, wastes that can be used as raw materials are also classified as solid wastes.
“As a developing country with the largest population in the world, China generates a large amount of solid wastes annually, and recycling of domestically generated wastes that can be used as raw materials is one of the key initiatives to solve the disposal of solid waste which is a emergent problem on environment.
“According to the principles universally recognised by the international community, the proper disposal of domestically generated solid wastes is the responsibility and obligation of every country. China has no obligation and no longer permits the disposal of what other countries claim as ‘recycling materials’ while leaving environmental pollution behind at home.”
China has previously stated that recycled materials would be permitted for import if they met its national standards.
Clearly, this means that the material will need to have been already recycled, with the exception of some scrap metals that have been permitted for import since last year.
With national standards also being developed for recycled plastics, this could mean that some import of processed material could resume at some point once these standards are implemented.
With paper and cardboard, the situation is more complex as it would appear that China will only consider imports of recycled pulp. This is why companies such as Nine Dragons, Lee & Man and Shanying have set up mills in South East Asia that take material from US, Europe etc and turn it into pulp or finished product with most sent to China.
The United States believes though that this discriminates between domestic solid wastes and imported wastes, with different domestic and foreign policies typically against WTO rules.
However, China argues that countries should manage their own wastes and not impose them on other countries as set out in the Basel Convention. This is a view that increasingly seems to be shared by others as they too put up import barriers.
So what next? If the United States is dissatisfied with the answers given by China, it can raise a dispute at the WTO, which will then be assessed by various panels as whether WTO rules have been broken. If China were found to have broken these trade rules, then they would need to make changes.
It remains to be seen whether the United States will take this action against China, but it tends to be a big step, and would therefore seem unlikely.