Presentation by Shardul Agrawala, Head of Environment and Economy Integration Division, Environment Directorate, OECD

1. INTERNATIONAL TRADE AND
THE CIRCULAR ECONOMY
Shardul Agrawala
Head Environment and Economy Integration (EEI) Division, Environment Directorate
GGSD Forum 2019 – Greening heavy and extractive industries
Paris, 27 November

2. 1. How trade matters for a Circular Economy – 3 Examples
2. Conceptualizing interlinkages between Trade and the Circular Economy
3. Impacts of a Circular Economy Transition on Trade flows
4. Specific issues for key material streams
– Recycling waste and secondary materials
– Reuse, remanufacturing – second-hand goods
5. Towards a mutually supportive Trade and Circular Economy Agenda
2
Outline

3. 1. Example 1 - Decoupling material use and the role of trade
Source: OECD (2019) 3
Trade
Source: OECD (2013), "Material resources", OECD Environment Statistics (database) 3

4. Example 2 – Trade in waste
4
Source: OECD (forthcoming), Trade and Environment Indicators 4
4

5. Example 2 (cont’d) –Import restrictions are re-shaping the
plastic waste system
5
Source: UN COMTRADE (2019), HS3915
Monthly global exports of plastics waste by destination: 2016 to 2018
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6. 6
Example 3 - Closing higher values loops across borders

7. 7
2. Trade and Circular Economy - broad interlinkages
National boundary
Repair
Recycling
(secondary raw materials)
Eco-
design
policies
Refurbishment and Remanufacturing
Reuse
(second-hand goods)
Trade in second-hand goods
Trade in waste for recovery
Trade in goods for
refurbishment and remanufacturing
Trade in secondary raw materials
Product-service-systems
Trade flows:
CE impacts on trade
Policy alignment Trade in waste, secondary material, second-hand goods
International co-operation
Trade in services
Source: Yamaguchi (2018) “International Trade and the Transition to a More Resource Efficient and Circular Economy: A Concept Paper”

8. 3. International trade can contribute to reduced material use
8
Effects of CE policies on global materials use by driver
(percentage deviation from baseline in 2040)
Source: Dellink (2019, forthcoming), The consequences of a more resource efficient and circular economy for international trade patterns - a modelling assessment
-60%
-50%
-40%
-30%
-20%
-10%
0%
Aluminium Copper Iron and steel Other non-ferrous metals Non-metallic minerals
Scale effect Efficiency effect Trade effect
8

9. 4. Specific issues for key material streams
Recycling – waste and secondary materials
• Potential opportunities
– Trade can help boost global recycling rates by shipping waste to countries with comparative
advantage in sorting and processing.
– Trade in environmental goods and services for efficient waste management.
• Potential challenges
– Definition and classification of waste and secondary materials.
– Regulating transboundary movement of waste (e.g. Basel Convention, proximity principle, import
and export restrictions)
– Waste flows to destinations with insufficient waste management capacity
– Illegal waste trade / informal sector
– Potential downcycling
9 9

10. Specific issues for key material streams
Reuse, remanufacturing – second hand goods
• Potential opportunities
– Promoting re-use of products through exports of second-hand goods (e.g. used cars, second-hand
textiles).
– Trade can provide opportunities for refurbishment and remanufacturing.
• Potential challenges
– Exports of second-hand goods could be considered as “leakage” from the official system (e.g.
extended producer responsibility schemes).
– Second-hand good imports may hinder the transition towards energy efficient and low carbon
economies due to slower market transformation or place additional pressures on the management
of end-of-life products.
– Issues in recovering end-of-life products across borders for refurbishment and remanufacturing as
they are often legally classified as waste.
– No comprehensive data on second-hand goods and goods for refurbishment and remanufacturing.
10 10

11. 5. Towards a mutually supportive trade and circular economy agenda
 International trade flows will shift according to structural changes induced by
a circular economy
 Trade will create opportunities for enhancing resource efficiency via
comparative advantage
 Need to seriously consider international standards & mutual recognition -
material content, recyclability
 Advances needed in data availability, definition and classification of waste
 Innovation and digitalization will provide additional opportunities
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For more information:
oe.cd/recircle
www.oecd.org/environment/envtrade
Shardul.AGRAWALA@oecd.org
Thank you