China implements ban on imported waste, stimulating plastic waste-exporting nations to develop alternative manufacturing, consumer products, and recycling strategies.

Following China’s notification to the World Trade Organisation (WTO) in 2017, the country is now phasing in a ban on certain types of waste imports. The new Chinese regulation banning the import of 24 types of waste, including plastics and unsorted paper, came into force on 1 January 2018 and will address major environmental and health issues in China.

Background

Since the 1980s, China has become the world’s largest importer of waste, accounting for over half of all global plastic scrap imports last year alone. According to statistics from the Bureau of International Recycling, China imported 7.3 million metric tonnes of plastic waste in 2016, mainly from Europe, Japan, and the United States, driven by increasing local demand and lower reprocessing and manufacturing costs. Until now, China’s waste purchases from the international market have spurred the growth of its immense recycling industry, with Chinese recyclers reprocessing the waste to make a wide range of usable materials, often for local manufacturers. When the WTO announced China’s new ban in 2017, however, the price of finished paper in China doubled as raw materials became scarce. In addition, major shipping companies stopped accepting scrap paper and plastic cargoes scheduled to arrive after 31 December 2017.

Although recycling has a number of environmental benefits, waste collected for recycling is frequently contaminated with hazardous materials, which can be released into the environment during the recycling process. In addition, the recycling process itself generates emissions. Although enforcement of safety measures and environmental regulations has become more systematic by virtue of China’s “war on pollution,” recyclers continue to dump contaminated waste in rivers, leading to polluted drinking water, and the unchecked burning of plastic has resulted in serious health and air quality issues.

China and the EU

In addition to tackling the environmental and health effects of China’s waste imports, the regulation also has the potential to galvanise waste-exporting countries to adopt more progressive disposal and recycling schemes. Rather than finding new places to export waste, governments and the private sector may have to explore alternative ways to reduce the amount of waste created, taking into account the entire lifecycle of products. For instance, between 2012 and 2016, the UK shipped an average 65% of the country’s exported plastic waste, or approximately half a million tonnes per year, to China. The UK recently launched its 25-year environment plan, which focuses heavily on plastics and seeks to “eliminate avoidable plastic waste” by the end of 2042. On a broader scale, the European Commission recently published its new plastics strategy, which, amongst other targets, aims to ensure all plastic packaging is reusable or recyclable by 2030.

Implications

China’s new ban is representative of a growing regulatory focus on environmental issues, and a growing willingness to accept economic trade-offs — such as an impact on China’s huge recycling industry — in exchange for a cleaner environment. China’s waste ban may have helped stimulate plastics and recycling initiatives in other parts of the world. However, a number of questions remain regarding the speed and success with which waste-exporting countries can adapt to this shock to the global recycling market.

This post was prepared with the assistance of Tegan Creedy in the London office of Latham & Watkins.