CHINA is the world’s biggest consumer of raw materials. Each year it buys billions of tonnes of crude oil, coal and iron ore. But there is one commodity market in which the country may soon play a less dominant role: waste. Last month China told the World Trade Organisation that by the end of the year, it will no longer accept imports of 24 categories of solid waste, as part of a government campaign against “foreign garbage”. Government officials say restricting such imports will protect the environment and improve public health. But the proposed ban will threaten billions of dollars in trade and put many Chinese recyclers out of business. Why is Beijing so eager to trash its trade in rubbish?
For decades China has been a major processing centre for the world’s recycled waste. In 2016 the country imported 45m tonnes of scrap metal, waste paper and plastic, together worth over $18bn. Paying foreign firms for trash may seem like an unfair deal, but the trade benefits both sides. Exporters earn a return on their leftover waste, much of which might otherwise end up in a landfill. Chinese firms, meanwhile, gain access to a steady supply of recycled materials, which are often cheaper and less energy-intensive than domestically sourced raw materials—recycled steel, for example, requires 60% less energy than steel produced from iron ore.
Such economic benefits come with costs, however. Imports of recyclable waste are often dirty, poorly sorted or contaminated with hazardous substances. Even when such waste is safely imported, it is not always recycled properly. In 2002 Chinese authorities faced widespread criticism after a documentary showed workers in Guangdong province crudely dismantling discarded electronic devices and dumping the toxic remains into a river. A more recent film, “Plastic China”, examines the environmental damage caused by the country’s plastic-recycling industry, which is dominated by thousands of small-scale outfits that often lack proper pollution controls. Facing growing public pressure, Chinese authorities have begun cracking down. In 2013 the government launched “Operation Green Fence”, a campaign to block imports of illegal and low-quality waste through improved inspections of container ships. In February Chinese customs officials announced “National Sword”, an initiative aimed at reducing illegal shipments of industrial and electronic waste. Last month’s announcement was only the latest of such efforts to clean up the industry.
The government says its proposed ban will protect the environment. But analysts point out that most of the waste consumed by China’s recycling industry comes from domestic sources, not imports. As for the millions of tonnes of waste that will soon be blocked at China’s border, some of the high-quality waste will find buyers in other countries such as Malaysia, Vietnam or Indonesia. The rest will probably end up in a landfill.