April 13th, 2018

China crisis: what import restrictions mean for Europe

6 minute read

by Ad Lansink

 

Over recent years, the Chinese government became increasingly aware that solid waste being imported into China for recycling also contained large amounts of dirty and hazardous wastes. To ensure the health of its citizens and protect China against serious environmental pollution, in 2013 it launched ‘Operation Green Fence’, which stepped up container inspections with the aim of stopping shipments of illegal and low quality waste. This was followed in 2017 with operation ‘National Sword’, which specifically targeted imports of WEEE and industrial waste.

In the latest development, as of January this year the government has adjusted the list of solid wastes which can be imported, while prohibiting the import of polluted solid wastes. While not strictly a ‘ban’, these restrictions have caused dark clouds to gather over the European recycling sector. After relying on China for the off-take of many recyclables, especially those of lower quality, European collectors and processors of a large number of waste types are now experiencing a significant challenge in finding markets for their secondary material.

 

Imperial standard

In their specifics, the new restrictions place outright prohibitions on a number of listed waste materials while placing a limit of no more than 0.5% contamination on those materials not on the list. Stricter quality standards now apply to imported wood, paper and cardboard, iron and steel, non-ferrous metal, electric motors, wires and cables, slag from melting furnaces, metal and electrical appliances, plastic and automotive parts. The threshold for acceptable radioactivity has also been lowered, while the new rules allow a maximum of 0.01 % of certain hazardous substances.

Although China has not formally declared a wholesale import ban on waste, the strict quality requirements have been felt as severe restrictions. I understand that the European average level of contamination across dry recycling streams is currently around 1.5% – three times China’s new limit. In the Netherlands, municipally collected paper – one of the materials targeted – can contain about 4% foreign materials. Clearly, adjusting collection and sorting systems to meet China’s new standards is going to be a difficult task. And it’s not only Europe that faces this problem: Australia and the United States, who have also relied on the Chinese market, will also feel the impact.

 

Euro trash

Nevertheless, it is hard to blame the Chinese government for taking action. Until fairly recently, the principle of self-sufficiency in waste management was generally agreed upon, not just within Europe but globally. Lately, it seems to have been less in vogue: in the Netherlands, for example, energy-from-waste incinerators have established multi-year contracts to import waste from England and Italy. The principle of self-sufficiency may be referenced in the Waste Framework Directive, but EU law allows for export for the purpose of ‘recovery’ at an R1 standard facility, and targets self-sufficiency of the European community as a whole. China’s action is a reminder that the EU remains far from self-sufficient in respect of reprocessing capacity for recycling.

The Chinese government’s imposition of stricter controls has further justifications. One is that the transition to a circular economy requires secondary materials of high quality, because these are essential for closing product and material loops. Another has to do with the prevention of environmental pollution in an ever growing economy; put simply, China no longer wishes to act as the sewer of the western world. China cannot grow its own circular economy if it continues to take in low quality materials from the rest of the world.

With its new rules, China is signaling that the optimal processing of its own reusable waste is preferable to providing less optimised waste services to other countries and continents, even when the latter is profitable. In a choice between investing in infrastructure for recycling high quality domestic material or for cleaning imported waste streams, the former is clearly better aligned with circular economy principles.

 

Pic: Non-recylable

No-go logo: China’s new import restrictions are exposing long-standing problems in how the West recycles. Photo: Hsing Wei (CC BY 2.0), via Flickr.

 

Europe’s reliance on waste export is largely due to its inadequate domestic processing capacity, but export has also been stimulated by relatively cheap transport and low processing costs in China – where processing capacity outstrips not only that of Europe but also Australia and the USA.  However, the goals driving China’s new industrial policy (preventing environmental pollution and transitioning to the circular economy) are also goals that Europe sees as necessary developments for itself.

At least in terms of setting policy, Europe has aimed at achieving closed-loop recycling and reducing downcycling. In practice, however, cost and convenience have continued to be major considerations. Rather than invest in high quality recycling, preference has been given to cheaply producing material for export. Many EU member states have also weighed the economic need to utilise their too-large incineration capacity – and the usefulness of heat generated from incineration – against the attendant increase in CO2 emissions and hindrance to better recycling and circularity.

 

Eastern wisdom

Contradictory trends are common in the intersection of economy and ecology. On one hand, for example, there is a call for stronger policies to combat climate change; on the other, a demand for increased aviation capacity to deliver economic benefits. Or consider the choice between using biomass as a building material, as a source for chemical recycling or simply as a fuel. The tension becomes even greater when immaterial aspects are taken into account: biodiversity, justice and equality are difficult to express in hard currency. However, within complicated contexts contrarian tendencies can offer new perspectives and create room for innovative developments.

In this way, the ‘Chinese ban’ may give government and industry – especially the recycling sector – room to focus explicitly on quality, not just quantity. By striving for processing close to or within a nation’s own domain, the transition to circular economy can be promoted. At the same time, trends that impede circularity must be challenged as much as possible, certainly when the quality of secondary material flows is at risk.

Europe should learn from China that quality is essential for closed loop and even high-grade use of secondary raw materials. The announcement and implementation of the waste import restrictions present a challenge: can we find an achievable solution in our own national or regional area? The actual causes of the Chinese import restrictions – the low quality of imports and the lack of adequate processing capacity in the West – are problems which always needed tackling.

China’s inconvenient action has served to make our problems clearer and more urgent to us. Now we need to recognise that solutions to many of them already exist:

  • Improving quality by preference for and stimulation of source separation, so far as possible.
  • When post-separation is unavoidable, using adequate washing and cleaning processes to increase output quality.
  • Improving and expanding Europe’s processing capacity, especially for old paper, textiles and plastics.
  • Research and development in the field of chemical recycling, yielding new material streams of high quality.
  • Strengthening of separation and processing by the development of new technologies, including in the field of (reverse) logistics.

 

These steps are important, both for the transition to the circular economy in Europe and for maintaining good relationship with China, which remains the world’s largest manufacturer of various consumer goods, including electronics and clothing. As the global impact of the waste hierarchy and the circular economy becomes increasingly felt, it’s in Europe and China’s mutual interest to cooperate on sustainable industrial policy. Therefore, Chinese import restrictions on foreign waste must be seen as a positive for the circular economy, and not simply as an unwelcome trade barrier.

 

Ad Lansink

 

 

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Paul Dumble

Ad I agree entirely. It looks like there will be a trend in building new capacity coming on stream in Eastern Europe/Turkey and beyond. So the market is already responding to China’s actions. One primary issue is that in the absence of recyclable treatment capacity surplus plastic recyclables will either end up in landfills, be incinerated or simply dumped stimulating an anticipated increase in plastic production – a “catch 22” position with no doubt our oceans suffering more plastic contamination.